Italy Warns: Dollar-Based Stablecoins Could Threaten the Euro’s Future

Italy’s Minister of Economy, Giancarlo Giorgetti, has issued a strong warning about the growing influence of dollar-backed stablecoins in Europe. Speaking at an asset management conference in Milan, Giorgetti voiced concerns that these digital assets—pegged to the U.S. dollar—pose a far more serious risk to the eurozone than traditional economic threats like tariffs or trade wars.

Stablecoins Are Gaining Ground

Stablecoins, particularly those tied to the U.S. dollar, are quickly gaining traction across the globe as reliable tools for international transfers, payments, and investments. Their appeal lies in offering the speed and flexibility of cryptocurrencies while avoiding their infamous price volatility. But Giorgetti sees a dark side to their rapid growth in Europe.

“These dollar-based stablecoins are silently shifting financial influence,” Giorgetti said. “They’re not just a convenience, they’re a strategic threat to our monetary independence.”

His remarks come amid increasing usage of these digital assets in Europe, particularly among young tech-savvy users and cross-border businesses who prefer their efficiency over traditional banking options.

Europe’s Answer: The Digital Euro

To counter the growing reliance on non-European digital currencies, the European Central Bank (ECB) is moving forward with its plans to launch a digital euro. This project aims to provide European residents with access to a government-backed digital wallet that can be used for daily transactions, online payments, and peer-to-peer transfers.

The digital euro is being positioned as a modern, secure alternative to privately issued stablecoins, especially those pegged to the dollar.

However, the initiative hasn’t been without its challenges. European commercial banks have raised red flags, warning that widespread use of a digital euro could lead to a mass migration of customer deposits away from private banks and into ECB-controlled wallets. This, they argue, could destabilize traditional banking systems and reduce banks’ ability to issue loans.

Giorgetti: Europe Must Act United

Giorgetti used his platform to call for unity and urgency among EU member states and financial institutions. He emphasized that Europe’s fragmented payments landscape and slow adoption of financial technology are leaving the region vulnerable to outside digital currency dominance.

“The U.S. has a clear strategy to expand its digital footprint through regulation and innovation. If we don’t match that energy, we risk being outpaced,” he warned.

He also suggested that Europe should accelerate regulatory clarity around crypto assets and make a stronger push to promote the euro as a globally preferred currency, not just in traditional finance but in digital markets as well.

What’s Next for the EU?

As U.S. regulators lean toward a more permissive stance on cryptocurrencies and stablecoin frameworks, Europe is being forced to confront the strategic implications of falling behind in the digital currency race. For leaders like Giorgetti, this isn’t just about technology, it’s about sovereignty, power, and long-term economic stability.

Whether the digital euro becomes a mainstream reality or not, Europe’s response to the rise of dollar-based stablecoins will likely shape the future of monetary policy and digital finance across the continent.