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Germany’s central bank president comments on stablecoins and their potential benefits for the EU

By Alex Rivera

Germany’s Central Bank Chief Endorses Euro‑Pegged Stablecoins as a Strategic Asset for the EU

Frankfurt, 16 Feb 2026 – Joachim Nagel, president of the Deutsche Bundesbank, used a New Year’s reception hosted by the American Chamber of Commerce in Frankfurt to underline the potential of a euro‑linked central bank digital currency (CBD‑C) and euro‑denominated stablecoins. He argued that these digital money tools could strengthen Europe’s payment infrastructure and reduce reliance on U.S. dollar‑based stablecoins that are poised to gain a foothold under recent U.S. legislation.

Key points from Nagel’s remarks

  • Retail CBDC progress: EU policymakers are intensifying efforts to launch a consumer‑focused digital euro. Nagel described these initiatives as “hard‑working” and integral to Europe’s digital finance roadmap.

  • Wholesale CBDC benefits: A tokenised form of central bank money for inter‑bank settlements would enable programmable transactions, a feature Nagel highlighted as a way to modernise the back‑office of finance.

  • Euro‑stablecoins as a bridge: While a full‑scale CBDC is still under development, the central bank president sees a role for privately issued, euro‑backed stablecoins in facilitating low‑cost, cross‑border payments for businesses and individuals.

  • Strategic independence: The push for euro‑anchored digital assets is, in part, a response to the U.S. “GENIUS Act,” which creates a regulatory pathway for dollar‑pegged stablecoins. Nagel warned that an unchecked surge of U.S.‑denominated tokens could erode European monetary sovereignty and limit the effectiveness of domestic policy tools.

Context: The U.S. legislative backdrop

In late 2025, U.S. President Donald Trump signed the GENIUS Act, establishing a regulatory framework for stablecoins tied to the dollar. The law is expected to be fully operational within 18 months of enactment, or within 120 days after the final set of regulations is approved. The move signals a concerted effort by Washington to formalise stablecoin markets and could give dollar‑linked tokens a competitive edge in global payments.

Potential impact on Europe

Nagel’s comments arrive at a time when the European Central Bank (ECB) and national central banks are balancing innovation with prudential oversight. A euro‑stablecoin ecosystem could:

  • Lower transaction costs: By bypassing correspondent banking layers, euro‑stablecoins could cut fees for SMEs and consumers in cross‑border trade.

  • Increase speed and transparency: Tokenised payments settled in real time would improve liquidity management for corporate treasurers.

  • Preserve monetary policy effectiveness: Keeping the majority of stablecoin activity within a euro‑based framework helps the ECB retain control over money supply dynamics.

  • Promote financial inclusion: A retail CBDC paired with stablecoins could reach under‑banked populations across the EU, especially in peripheral markets.

Challenges and risk considerations

Nagel’s earlier remarks at the Euro50 Group warned about the dangers of an over‑reliance on foreign‑currency stablecoins. Key risks that European regulators must address include:

  • Regulatory arbitrage: Divergent rules between jurisdictions could drive capital to jurisdictions with looser oversight.
  • Operational security: Stablecoin platforms need robust cyber‑risk controls to protect against hacking and systemic disruptions.
  • Market concentration: Dominance by a handful of large issuers could threaten competition and resilience.

Analyst view

Crypto‑market analysts view Nagel’s endorsement as a signal that Europe is preparing a coordinated policy response to the evolving global stablecoin landscape. “The Bundesbank’s stance suggests that the EU is not waiting for a perfect CBDC before entering the digital‑asset arena,” says Elena Schmidt, senior analyst at CryptoInsights. “A hybrid approach—combining a wholesale CBDC for inter‑bank flows with privately issued euro‑stablecoins for everyday payments—could give the euro a competitive edge against the dollar in the next decade.”

Key takeaways

  • Euro‑stablecoins are slated to complement a future retail digital euro, offering a near‑term solution for low‑cost cross‑border payments.
  • The EU’s drive for digital monetary independence is partly a reaction to the U.S. GENIUS Act, which will likely boost dollar‑pegged stablecoins.
  • A wholesale CBDC would enable programmable, central‑bank‑money transactions, enhancing the functionality of the financial system.
  • Regulators must balance innovation with safeguards to avoid monetary‑policy erosion, cyber‑risk exposure, and market concentration.
  • Industry observers see a dual‑track strategy—retail CBDC plus euro‑stablecoins—as the most viable path for Europe to maintain monetary relevance in a tokenised world.

The Deutsche Bundesbank’s public support for euro‑linked stablecoins underscores a broader European ambition: to craft a digital payments ecosystem that is both technologically advanced and firmly anchored to the euro, preserving monetary sovereignty while embracing the efficiencies of blockchain‑based finance.



Source: https://cointelegraph.com/news/germany-central-bank-president-stablecoins?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound

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