The mass adoption of stablecoins could trigger a significant outflow of retail deposits from the banking system. This warning was issued by Piero Cipollone, a member of the Executive Board of the European Central Bank (ECB), at the annual conference of Federcasse, the Federation of Cooperative Credit Banks of Italy.
Cipollone noted that financial institutions are already feeling pressure from digital payment services, which are gradually depriving them of fee income and control over payment data. However, the most serious blow, in his words, could be dealt precisely by stablecoins: if their use continues to grow, banks will lose retail deposits—the foundation of their resource base.
Digital Euro as a Strategic Response
In this context, Cipollone emphasized that the launch of the digital euro (CBDC) is not merely a technological experiment, but a critically important tool for preserving the role of public money in the digital economy. In his view, the project will keep banks at the center of the payment ecosystem and simultaneously provide the European Union with its own independent payment infrastructure.
The regulator's argument is based on alarming statistics: in 13 out of 21 eurozone countries, there is no national card scheme, and more than half of the states lack domestic solutions for e-commerce. As a result, two-thirds of all card transactions are processed through non-European systems, and this share continues to grow.
Safety for Banking Liquidity
The ECB assures that the design of the digital euro—with strict holding limits and no interest accrual—will not pose a threat to banking liquidity or financial stability. As a reminder, on July 14, the regulator already selected 36 banks and payment companies to participate in the pilot project. The operational phase will begin in the second half of 2027 and last 12 months.
My comment: The ECB's warnings are a signal to the market that regulators see stablecoins not just as an alternative tool, but as a potential competitor to the traditional banking system. In this context, the digital euro becomes not so much an innovation as a protective mechanism. However, the question remains whether a centralized CBDC can compete with decentralized stablecoins in terms of convenience and user trust—or whether we are witnessing an attempt to maintain control over monetary issuance at any cost.