Italian Economy Minister Giancarlo Giorgetti has issued a stark warning about the growing influence of U.S. dollar-denominated stablecoins, claiming they pose a greater threat to Europe’s financial stability than traditional trade tariffs. Speaking at an asset management conference in Milan, Giorgetti voiced deep concern over the impact of U.S. crypto regulations on the European economy.
“The general focus these days is on the impact of trade tariffs. However, even more dangerous is the new U.S. policy on cryptocurrencies and in particular that on dollar-denominated stablecoins,” Giorgetti stated.
U.S. Stablecoin Policy Under Scrutiny
The remarks come amid sweeping regulatory efforts in the United States led by President Donald Trump, including the controversial GENIUS Act, which aims to set clear rules for stablecoin issuance and usage. A key motivator behind the legislation is the involvement of World Liberty Financial (WLFI)—a company linked to the Trump family—whose own stablecoin is gaining traction.
Giorgetti warned that if the GENIUS Act passes, it could lead to a financial landscape where savers worldwide can invest in low-risk, dollar-backed digital assets without needing a bank account. This development could significantly undermine traditional financial systems, especially in regions already grappling with economic instability or high inflation.
Impact on European Banking and Currency Sovereignty
Giorgetti stressed that even eurozone citizens may be drawn to dollar-based stablecoins, as they offer a level of stability and accessibility that many banks and financial institutions cannot match—especially in crisis-prone economies.
“It is easy to foresee their attractiveness for citizens of economies with unstable currencies, but its appeal for people of the euro zone should not be underestimated,” he said.
The dominance of USD-backed stablecoins is already evident: over 99% of the stablecoin market capitalization is currently tied to the U.S. dollar. This leaves Europe at a disadvantage, especially as banks risk losing critical deposits that form the basis of lending and credit creation.
A Call for European Action
To counter this threat, Giorgetti urged the European Union to address its fragmented payments infrastructure. He emphasized the need for the rapid development and deployment of a digital euro, which could provide Europeans with a stable, local alternative for digital transactions—without relying on foreign-controlled assets.
“We need to modernize our payment systems and provide real alternatives, or we risk losing control over our financial autonomy,” Giorgetti warned.
The European Central Bank (ECB) has previously acknowledged the potential of a digital euro, especially in supporting programmable and conditional payments. However, the lack of unified progress across member states has slowed adoption.
Outlook
As global interest in stablecoins accelerates, Giorgetti’s comments reflect a growing awareness within Europe of the geopolitical and economic implications of U.S. dominance in the digital asset space. Whether through regulatory reform, innovation, or collaboration, the EU now faces increased pressure to safeguard its monetary sovereignty in a rapidly evolving digital economy.
