European officials have intensified their work on creating a digital euro (CBDC) after the U.S. passed a law regulating the stablecoin market. According to sources from the Financial Times, the European Union is now seriously considering launching a digital euro on public blockchains such as Ethereum ($ETH ) or Solana ($SOL ), instead of a private one, as previously planned.
Using a public blockchain could help make the digital currency accessible worldwide, but at the same time, it raises concerns about transaction transparency and user privacy. One source from the Financial Times noted that this option was previously considered less seriously.
After the passage in the U.S. of the so-called GENIUS Act, which regulates stablecoins, EU officials decided to 'review their plans for a digital euro.' This step is a response to the dominance of the U.S. dollar, which is being strengthened by stablecoins issued by companies like Circle, Tether, and other major financial institutions.
The European Central Bank (ECB) has been working on a digital euro for several years to create its own digital currency available to all citizens of the eurozone. While euro-denominated stablecoins already exist, such as EURC from Circle, the EU wants to have its own independent digital asset to keep up with China, which has already advanced with its state token, and the United Kingdom, which is considering creating a digital pound.
The ECB confirmed to the Financial Times that it is considering various technologies — both centralized and decentralized (including distributed ledger technology, or DLT), and a final decision on the digital euro has not yet been made.
