ECB adviser Jürgen Schaaf said the European Union may use euro stablecoins to counter the rise of US dollar stablecoins. In a blog post on the ECB website, he stated that a digital euro alone would not be enough to address the challenge.
“First, more support could be provided for properly regulated euro-denominated stablecoins,”
Schaaf wrote. He added that euro stablecoins built to high standards with strong risk controls could meet market demand and help reinforce the euro’s role.
Schaaf warned against neglecting euro stablecoins, calling it a potential “strategic blind spot.” His comments reflected an emphasis on combining both the digital euro and private-sector solutions like euro stablecoins to address the influence of US dollar stablecoins.
Low Adoption of Euro Stablecoins in Europe
The use of euro stablecoins in Europe remains limited. In May 2025, Bank of Italy Governor Fabio Panetta, formerly with the ECB, noted that the circulation of euro stablecoins was still low despite regulatory frameworks like MiCA.
Panetta also said the digital euro would be important for addressing the slow adoption of euro stablecoins. He connected its development with preserving stability in the eurozone’s monetary system.
In July 2025, DWS and Deutsche Bank received regulatory approval for a euro stablecoin. However, US dollar stablecoins such as Tether (USDT) and USDC continued to dominate global transactions, underscoring the dominance of dollar-backed assets over euro stablecoins.
ECB Integrates DLT to Support Payments
Schaaf stated that the digital euro will be one part of the ECB’s broader digital payments approach. He highlighted the role of distributed ledger technology (DLT) to improve both wholesale and cross-border payment systems in the EU.
“In point-of-interaction payments, the digital euro promises to be a robust line of defence of European monetary sovereignty,”
Schaaf wrote. He also said that DLT and euro stablecoins could function alongside the digital euro.
On July 1, 2025, the ECB approved two pilot projects, Pontes and Appia, to test DLT in wholesale and cross-border settlements. Additionally, these projects aim to strengthen the EU’s financial infrastructure and further support the future integration of euro stablecoins.
Digital Euro Decision Timeline for 2025
The ECB placed the digital euro in its “preparation phase” in November 2023. A final decision on whether to advance to the next phase is expected by the end of 2025, according to the ECB Governing Council.
Concerns around US dollar stablecoins intensified after US President Donald Trump signed an executive order in January 2025 supporting dollar sovereignty through stablecoins. This move increased urgency in the EU for progressing both the digital euro and euro stablecoins.
In July 2025, ECB President Christine Lagarde reaffirmed support for the digital euro. ECB board member Piero Cipollone said it could protect eurozone monetary sovereignty.
Jürgen Schaaf’s remarks highlighted an EU plan using the digital euro, euro stablecoins, and DLT projects to address US dollar stablecoins.