TL;DR Breakdown
- Europe can’t depend on the digital blockchain technology of other nations.
- Digital Euro is a necessity for Europe to avoid dependence and lead others.
- The current scenario in Europe favors monetary institutions, and a change is needed.
Europe is lagging behind America and Asian nations. There are already plenty of stablecoins that represent the US dollar, like USDT or USDC. There is also a rapid adoption of crypto assets in Asian countries as well. The absence of a stablecoin might hurt the chances of Europe being a leader in terms of blockchain technology and financial integrity. Therefore, the digital Euro seems to be a rescue for Europe.
Suppose the European policymakers don’t start making effective laws in favor of stablecoins and digital Euro. In that case, it is possible that Europe will have to depend on the American or Asian stablecoins. Stablecoins have proved to be very effective and have broken the long-standing financial architecture all around the world. By linking fiat with cryptocurrencies, digital stablecoins have led to growth and expansion throughout the world.
Need for the digital Euro in Europe
Currently, the European Union’s Regulation of Markets in Crypto-assets, or MiCA, is unable to draft clear-cut policies for stablecoins and cryptocurrencies. There is a struggle amongst the Parliament and state members resulting in laws that actually favor traditional monetary institutions. In such a situation, if the digital Euro is introduced, it could be that people might need a license to own them.
The authorities cannot be blind to the growth of cryptocurrencies and increasing demand for the digital Euro. If the government doesn’t implement policies soon, citizens might turn to crypto exchanges that are not backed by the European government, increasing the cases of fraud.
When compared to USDT or USDC, the transaction volume of Euro is next to zilch. The transaction volume for USDT or USDC is around $100 billion each and every day. USDT is currently the most used cryptocurrency in the world, and it is the most valuable stablecoin. For Europe to maintain its influence, it will have to come up with policies for the digital Euro soon.
