The President of the Eurogroup, Paschal Donohoe, believes that the introduction of a pan-European payment solution, through the creation of the digital euro, has become “imperative” for Europe to retain its strategic autonomy, in his letter to the leaders of the euro area countries, who will be meeting in Brussels on Thursday 20 March, on the fringes of the European Council.
Noting an acceleration “at an unprecedented pace” in the evolution of the digital payments industry (see EUROPE 13597/16), Donohoe calls for careful monitoring of the rise of cryptoasset markets, which are subject to “divergent” regulatory approaches internationally.
“If these ongoing shifts continue and the interconnectedness between the financial sector and crypto market increases (for example through the use of leverage and lending activity), it could pose risks to the stability of the financial system and our economic sovereignty” he believes, warning of “the costs of inaction” that would jeopardise the ECB-led digital euro project.
US President Donald Trump recently decreed the creation of a reserve of stablecoins, including 200,000 Bitcoins seized in legal proceedings. A decision that could encourage private players to develop mass payment solutions based on these stablecoins.
SIU. The President of the Eurogroup is also looking forward to the European Commission’s communication on the Savings and Investments Union, due on Wednesday 19 March. “It is essential to seize the opportunity to take decisive and tangible steps to advance the integration of capital markets in the EU”, he stresses.
Defence. Finally, on the budgetary front, Mr Donohoe spoke of the increasingly central role of public spending on defence, in response to international geopolitical developments.
“The Eurogroup will actively contribute to discussions on increasing this spending while guaranteeing fiscal responsibility and the sustainability of public debts”, he promises.
See Mr Donohoe’s letter: https://aeur.eu/f/fys (Original version in French by Mathieu Bion)