The European Central Bank opposes easing euro stablecoin regulations, stating it could undermine bank lending and interest rate control.

ChainCatcher news, according to Reuters, the European Central Bank opposed a proposal to promote more euro stablecoins at the EU finance ministers' meeting, arguing that relaxing liquidity requirements for stablecoin issuers or even granting them access to ECB financing could undermine the stability of bank deposits, restrain bank lending, and make interest rate control more challenging.

The proposal was put forward by Bruegel in a conference document, aiming to expand the market currently dominated by USD stablecoins. ECB President Christine Lagarde has also expressed a cautious stance on euro stablecoins and prefers the tokenization of commercial bank deposits.

The report also states that the EU is reviewing the MiCA, which came into effect in 2024, while the United States will pass the more lenient GENIUS Act in 2025.