The European Central Bank (ECB) sees the digital euro as a crucial public anchor in a future financial system where stablecoins and tokenised deposits coexist with cash and bank money. Speaking at JP Morgan’s European Financials Conference on 21 November 2025, Supervisory Board member Pedro Machado said a digital euro would extend central bank money into the digital realm and help safeguard stability.
“As people increasingly prefer to pay digitally, it is our responsibility to ensure there is a reliable, public and free digital means of payment that works equally in all euro area countries,” Machado said. He argued that money is “fundamentally a public good” and warned that privately issued tokens, if left unchecked, could weaken the role of central bank money in settlement.
Digital euro as public anchor in a multi-asset ecosystem
Machado linked the ECB’s work on the digital euro to the rapid growth of stablecoins, especially in the United States where a clearer regulatory framework is emerging. Recent US moves, he said, may accelerate adoption of dollar-denominated stablecoins worldwide, increasing the risk of spillovers into the European banking system and financial stability.
In response, he urged Europe to harness digital innovation on its own terms. That means encouraging tokenised traditional assets, including tokenised deposits, and “well designed, regulated homegrown euro stablecoins” that operate under clear and enforceable rules. Properly regulated euro tokens could support Europe’s strategic autonomy, reduce dependence on third-country stablecoins and enable innovations such as programmable payments and tokenised securities settlement.
At the same time, Machado warned that regulatory divergences between the EU and the US create concrete risks. He highlighted concerns about “multi-issuer” stablecoin models in which the same fully fungible token might be issued in different jurisdictions under different rules. In this context, he welcomed a recent recommendation from the European Systemic Risk Board asking the European Commission to clarify that third-country multi-issuer schemes are not permitted under the Markets in Crypto-Assets (MiCA) Regulation.
For the ECB, the digital euro and the regulation of stablecoins are part of the same policy puzzle. A successful digital euro, offered as a free public means of payment with strong privacy protections, would coexist with private innovations but preserve the central bank’s role at the core of the system. Stablecoins and tokenised deposits could then operate “around” that anchor, rather than competing with it as alternative monetary bases.
Machado’s comments come as the Eurosystem continues the preparation phase of the digital euro project, which runs until 2025 and focuses on technical design, rulebooks and cooperation with the European Commission. For background on that phase, see Digital Euro News’ earlier coverage. The final decision on whether to issue a digital euro is expected later in the decade, once legislation is agreed and large-scale testing is complete.
For banks and fintechs, the message from Frankfurt is that the window for shaping this future is now. Institutions will need to adapt to a world where central bank digital money, tokenised deposits and regulated euro stablecoins coexist, while supervisors intensify their focus on operational resilience, digitalisation and new forms of liquidity and settlement risk. For citizens, the debate will determine whether the euro remains available as public money in both cash and truly digital form, regardless of which commercial or foreign platforms dominate payments.