The stablecoin market continues to gain momentum, and this is beginning to worry European regulators at the highest level. Piero Cipollone, a member of the Executive Board of the European Central Bank (ECB), issued an alarming statement: the mass adoption of digital assets pegged to fiat currencies could lead to a significant reduction in retail deposits in traditional banks. This statement was made at the annual meeting of the Italian Federation of Cooperative Credit Banks, Federcasse.
Cipollone emphasized that the banking sector is already under pressure from mobile payment services, which are gradually "eating away" fee income and control over payment data. However, the shift to stablecoins poses a much more serious threat. While depositors previously simply transferred money between accounts, they can now completely withdraw funds from the banking system into cryptocurrency wallets, depriving banks of a key source of cheap funding—retail deposits.
Against this backdrop, Cipollone once again raised the issue of the need for a digital euro (CBDC). In his view, this is not just a technological innovation, but a strategic tool for preserving the role of public money in the digital age. The digital euro is designed to keep banks at the center of the payment ecosystem and simultaneously provide the European Union with its own, independent payment infrastructure. The argument is compelling: currently, two-thirds of all card transactions in the EU go through non-European systems, and this share is steadily growing. In 13 of the 21 eurozone countries, there is no national card scheme at all, and more than half of the states lack their own e-commerce solutions.
The ECB, however, assures that the risks to financial stability from launching the digital euro are minimal. The model with strict holding limits and zero interest yield is designed to avoid posing a threat to bank liquidity. It is worth recalling that last week, the regulator already announced the selection of 36 banks and payment companies to participate in the pilot project. The operational phase launches in the second half of 2027 and will last 12 months.
Cryptalist Analytics
The ECB's concerns are quite justified, but I would note that the problem runs deeper. Stablecoins are merely a symptom of a larger process: the loss of trust in the traditional banking system as the only safe store of value. The digital euro, with all its limitations, could indeed become a bridge, but only if it offers users real advantages—speed, convenience, and possibly partial anonymity. Without this, the fight against deposit outflows risks turning into an endless race to catch a departing train.