The head of Germany’s central bank has advocated for the creation of euro-based stablecoins as part of a strategic push for Europe’s financial sovereignty. Bundesbank President Joachim Nagel outlined three priorities, including modernizing regulations and developing European digital payment solutions like a digital euro, to reduce dependency and bolster the region’s competitiveness against global economic pressures.
Europe is playing catch-up in the global race for financial influence and is now looking more seriously at euro-denominated stablecoins. According to Joachim Nagel, president of the Deutsche Bundesbank, the region should support such stablecoins to strengthen its financial independence.
Nagel stated that euro-based stablecoins could enable low-cost cross-border payments for individuals and firms. He made the remarks at the New Year’s Reception of the American Chamber of Commerce in Frankfurt.
The push comes amid a transatlantic economic relationship worth roughly €5.4 trillion in mutual investment stock. Nagel noted, however, that “the previously solid ground of the transatlantic partnership values seems shaky.”
Europe faces economic pressure from rising protectionism and global trade tensions. These forces are slowing growth and hurting the region’s competitiveness.
To address these challenges, Nagel outlined three main priorities for Europe. The first is to simplify regulations and reduce administrative burdens.
The second priority is to advance a Savings and Investments Union to unlock private capital. The final priority is strengthening the euro’s global role through strategic digital initiatives.
This includes building independent European payment systems and launching a digital euro for consumers. It also involves exploring wholesale central bank digital currencies and supporting euro-based stablecoins.
Nagel emphasized that a digital euro would be “the first pan-European retail digital payment solution, based solely on European infrastructures.” The broader strategy aims to provide Europe with more financial sovereignty in a changing world.
