The European Central Bank Shifts Stance on Crypto Regulation Amid Washington's Support
Trump's Crypto Embracement May Imperil European Economy, According to ECB Report
April 24, 2025
The European Central Bank (ECB) has proposed revising the EU's crypto market regulation amid concerns over the potential impact of U.S. President Donald Trump's pro-crypto policies on the European economy.
According to leaked policy reports, the ECB believes that Trump's strong backing for the American crypto sector could cause a financial contagion that might jeopardize the European economy.
Insights from Politico suggest that European officials are concerned that several of the significant financial market reforms championed by Trump may undermine efforts to reform the EU's financial sector.
One of the primary worries centers around asset-pegged digital asset stablecoins, which are primarily denominated in dollars.
With a potential surge in dollar-backed tokens looming following a White House executive order to bolster the crypto sector and lawmakers' consideration of stablecoin regulatory bills, the ECB fears that these assets could disrupted the European economy.
While the European Union's Markets in Crypto Asset Regulation (MiCA) offers some safeguards against foreign currency-backed stablecoins causing market chaos, ECB officials have expressed reservations that the legal framework may not withstand the impact of the U.S.'s burgeoning stablecoin industry.
ECB President Christine Lagarde and her digital payment counterpart, Piero Cipollone, argue that an influx of dollar-denominated assets into Europe could divert savings into the U.S.
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- The ECB aims to revise EU crypto market regulation, concerned about potential financial contagion from U.S. President Donald Trump's pro-crypto policies.
- In an effort to enable startups, Saison Capital, BRI Ventures, and Coinvestasi have launched Tokenize Indonesia, a regulatory sandbox that integrates blockchain technology.
- Flock.io has partnered with Alibaba Cloud for super-intelligent AI model co-creation, which could potentially revolutionize the crypto market.
- In a move to bolster its crypto sector, the White House has issued an executive order, causing a potential surge in dollar-backed tokens like Ethereum and altcoins, which ECB officials fear could disrupt the European economy.
