European Union policymakers are considering the introduction of a digital euro in response to U.S. stablecoin regulations. The U.S. Congress recently approved the GENIUS Act, sparking concerns in Europe about dollar-pegged tokens dominating cross-border payments. Officials are now exploring launching a central bank digital currency (CBDC) on public blockchains like Ethereum or Solana.

The European Central Bank (ECB) is shifting towards considering launching a digital euro on public blockchains rather than a private system. U.S. legislation has influenced this shift, with policymakers now open to decentralized networks to help the euro compete globally. The ECB has been studying a digital euro as cash use declines, amid concerns of euro deposits flowing into dollar-denominated assets.

Europe is under pressure to deliver a digital currency as China trials its digital yuan and the U.K. explores a digital pound. While euro-backed stablecoins exist, a central bank-issued token would have more impact. The ECB is evaluating centralized and decentralized technologies, aiming to protect the euro’s relevance in a digital world.

The European Central Bank (ECB) is evaluating options for a digital euro, considering both centralized and decentralized technologies. The move comes as the U.S. pushes for more regulation of stablecoins, raising concerns in Europe about the impact on the euro’s strength in the global market.

Read more at Yahoo Finance: U.S. Stablecoin Law Jolts EU Into Rethinking Digital Euro Strategy: FT