Bundesbank chief urges Europe to embrace euro stablecoins, CBDCs and a digital euro to shore up financial sovereignty As geopolitical and economic pressures pile up, Europe is increasingly treating digital money as a strategic priority. Joachim Nagel, president of the Deutsche Bundesbank, told the American Chamber of Commerce’s New Year’s Reception in Frankfurt that the continent should back euro-denominated stablecoins alongside a digital euro and wholesale central bank digital currency (CBDC) to bolster its financial sovereignty. “I also see merit in euro-denominated stablecoins, as they can be used for cross-border payments by individuals and firms at low cost,” Nagel said, highlighting stablecoins’ potential to reduce frictions in cross-border payments. Why now? The EU and US remain deeply integrated—twin economic partners with about €5.4 trillion in mutual investment stock and a relationship that accounts for roughly 30% of global trade and around 44% of global GDP. But Nagel warned that the transatlantic partnership’s foundation appears less secure than it once did. Europe faces mounting headwinds from protectionism and trade tensions that are slowing growth and eroding competitiveness (Source: Bundesbank.de). Nagel also pointed to a persistent obstacle within Europe: despite a large single market, the financial landscape remains fragmented. That fragmentation makes it harder for startups and innovative firms to secure funding on the same scale as their U.S. counterparts. To tackle these challenges, Nagel outlined three priorities for strengthening Europe’s economic resilience and the euro’s international role: - Simplify rules and cut administrative burdens to spur investment and growth. - Advance the Savings and Investments Union to unlock private capital and improve funding for innovation and digital infrastructure. - Boost the euro’s global standing by building independent European payment rails, launching a consumer-facing digital euro, exploring wholesale CBDCs for financial institutions, and supporting euro-based stablecoins to enable cheaper cross-border payments. Nagel framed these initiatives as part of a broader push for strategic digital sovereignty: “This will be the first pan-European retail digital payment solution, based solely on European infrastructures.” As policymakers weigh regulatory frameworks for stablecoins and CBDCs, Nagel’s remarks underscore growing momentum in Europe to create interoperable, sovereign digital payment options that aim to reduce reliance on foreign systems while improving efficiency for consumers and businesses. Disclaimer: AMBCrypto's content is meant to be informational in nature and should not be interpreted as investment advice. Trading, buying or selling cryptocurrencies should be considered a high-risk investment and every reader is advised to do their own research before making any decisions. © 2026 AMBCrypto Read more AI-generated news on: undefined/news

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