ECB Advisor Expresses Doubts on Digital Euro’s Ability to Compete with USD and Stablecoins

A senior advisor at the European Central Bank has voiced skepticism about the proposed digital euro’s ability to rival the dominance of the US dollar in global payments, as well as private stablecoins. The advisor, speaking at a recent financial conference, stated that the digital euro will face considerable hurdles in gaining widespread adoption, particularly given the established presence of alternatives such as the dollar and privately issued stablecoins. They indicated that the design of the digital euro must focus on meeting user needs and providing clear advantages compared to existing solutions. Furthermore, the advisor emphasized the importance of ensuring user privacy in any potential digital euro system, while maintaining compliance with anti-money laundering and counter-terrorism financing regulations. They stressed that striking a balance between these competing objectives will be critical to the success of any central bank digital currency. The potential for a successful digital euro remains a topic of lively debate among economists and policymakers, with some arguing that it could enhance the financial independence of the European Union and improve payment efficiency, while others doubt its capacity to fundamentally alter the global financial landscape.