The following is a guest post and an opinion of Eneko Knörr, CEO and co-founder of Stabolut.
Months ago, in an OP-ED for CryptoSlet, I warned that the EU flagship, Mica, would achieve the opposite of his goals. I stated that the euro innovation would strangle while it would confirm the dominance of the US dollar for a new generation.
At the time, some thought this was an alarmist. Nowadays, with grim validation, the same concerns are reflected from the European Central Bank itself. In a recent blog post, also emphasized by the Financial Times, ECB adviser Jürgen Schaaf described the state of the euro-bound Stablecoin market as “gloomy” and warned that Europe is running the risk of being “steamed” by dollar-based competitors.
This warning comes in a critical time. In the traditional world economy, non-usd currencies are the lifeline of trade. They account for 73% of global GDP, 53% of Swift transactions and 42% of the central bank reserves. Yet these same currencies in the budding digital economy are almost invisible. The second most important currency in the world, the euro, has been reduced to a digital completion error.
By the figures: a digital gap
The data reveals a surprising decoupling. Although privately issued, Dollar-Mixed Stablecoins recommend a market capitalization that is approaching $ 300 billion, their heads struggled by euro struggling to reach $ 450 million, according to data from Coingecko. That is a market share of only 0.15%.
This is not a gap; It’s a gap. It means that for every € 1 of value that is handled on a blockchain, there are almost € 700 in US dollars. This dollarization of the digital world is a profound strategic risk for Europe’s monetary sovereignty and economic competitiveness.
Mica’s billion-euro handbrake
The historical markets of the EU in the regulation of crypto-assets (MICA) were intended to create clarity, but in his ambition to control the risk, it unintentionally built a cage. Although its framework for e-money tokens (EMTs) offers a path to regulations, it contains a poison pill for every euro stablecoin with global ambitions.
The largest limitation is the limit of € 200 million on daily transactions for each EMT that is considered ‘considerable’, as detailed in the official Mica text. This is not an accident or a simple supervision; It is a function that has been designed to ensure that no private) Stablecoin can ever really succeed.
For context, the leading dollar stablecoin, Tether (USDT) regularly processes more than $ 50 billion in daily volume. A limit of € 200 million is not a safety measure; It is a declaration of non-ambition that makes it mathematically impossible for a euro stablecoin to function on the scale required for international trade or decentralized financing.
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The motivation seems clear: policy makers deliberately sabotage the private sector to erase the field for their own project – the digital euro.
The digital euro: a threat to the privacy of citizens?
By suffocating private innovation, the EU places all its bets on a State -controlled Central Bank Digital Currency (CBDC). This is not only a slow, centralized answer to a fast -moving, decentralized market, but also pays a fundamental threat to the privacy of European citizens.
Physical money offers anonymity. A transaction with a note of € 5 is private, peer-to-peer and leaves no data path. A CBDC is the opposite. It would move all transactions to a centralized digital ledger, creating a system of detailed surveillance. It gives the state the potential power to check, follow and even determine how every citizen uses his own money. Building the future of the euro on this foundation means changing the freedom of the wallet for a transparent digital piggy bank-a consideration that the most citizens would rightly refuse.
The global race Europe ignores
While Brussels focuses on building the walled garden, other major economic powers have the strategic importance of private -published stabile -ins. They do not see them as a threat, but as an essential tool for projecting monetary influence in the digital age.
Even China is reportedly investigating the role that a Stablecoin supported by CNY could play in internationalizing the Yuan. In Japan, supervisors have already adopted a milestone Stablecoin Bill, creating clear paths for the issue of yen-supported Stablecoins. These countries understand that the digital currency war will be won by private innovation in empowerment, not by centralizing control. The current path of Europe makes it a spectator in a race that it should lead.
A policy playbook for the euro
If the euro has to compete, Brussels must perform a Radical Policy U-turn. The goal should not be to contain stablecoins, but to make the EU the most important global hub for publishing them. This requires a strategy with clear eyes that recognizes private innovation will always exceed centralized solutions.
Here is a Playbook for how Europe can win:
- Uncap the Future: completely remove the paralyzing transaction cap of € 200 million. The market, not supervisors, must determine the scale of a successful project. Let Euro Stablecoins ad Infinitum grow and compete on a worldwide stage without artificial ceilings.
- FAST-Track Licenses: Set a Pan-European Fast-Track Authorization process for qualified EMT-EMEnTen to reduce time-to-market and encourage a lively, competitive ecosystem.
- Follow the American model – announces the CBDC: the United States has gained its advantage by giving priority to the clarity of the regulatory authorities for private emennents, while they can effectively arrange its own CBDC plans in the retail trade. Europe must do the same. Cancel the digital euro project Formally, acknowledge the fundamental privacy risks that it yields and acknowledges that the only best strategy to grow the international influence of the euro is to fully support a flourishing, private issued Stablecoin market.
The choice is Stark: Europe can continue its path of self -imposed digital irrelevance, or it can unleash its innovators to build the future of finance. At the moment, that future is almost completely built with American digital dollars, and the time is to change that.