ECB Official Warns Stablecoins Threaten Traditional Bank Deposit Models
Piero Cipollone of the ECB has warned that growing stablecoin usage poses a risk to traditional bank deposits, while positioning the digital euro as a solution to maintain banks' central role in payment systems.
Piero Cipollone, a member of the European Central Bank Executive Board, has warned that increased adoption of stablecoins poses a significant threat to the retail deposit base held by traditional commercial banking institutions.
During a Friday address delivered to Italy's Federation of Cooperative Credit Banks in Rome, he emphasized his position that the evolution of digital payment systems is fundamentally transforming the banking landscape and deepening Europe's dependence on payment infrastructure controlled by entities outside the continent.
According to Cipollone, traditional banking institutions are currently experiencing losses in payment-related fee revenue and valuable transaction data, which are increasingly flowing to mobile payment service providers. He emphasized that introducing the digital euro would serve as a critical tool in maintaining banks' position within the payment infrastructure.
The digital euro would both preserve the role of public money and ensure banks remain involved in the payments ecosystem while continuing to meet their customers' needs.
Piero Cipollone
Earlier this week on Tuesday, the ECB announced its selection of 36 payment service providers spanning multiple sectors—including traditional banks, fintech companies, and specialized payment firms—to participate in a 12-month pilot program for the digital euro scheduled to launch during the second half of 2027.
The initiative is designed to evaluate the operational feasibility of a retail central bank digital currency deployment throughout the euro area, serving as a testing phase before any final determination on whether to issue the currency, a decision the ECB has indicated might occur as soon as 2029.