French central bank warns Trump’s crypto policies could spark crisis

France’s central bank governor warns that Trump’s pro-crypto policies, including a Strategic Bitcoin Reserve, could trigger global financial instability.

French Central Bank Governor François Villeroy de Galhau has issued a strong warning about Donald Trump’s pro-crypto policies, calling them a potential trigger for economic instability. He believes the U.S. administration’s support for digital assets and deregulation could create financial turmoil, spreading beyond American borders.

Trump’s stance on cryptocurrency played a key role in his re-election campaign, attracting digital asset advocates eager to replace the previous anti-crypto administration. Since returning to office, his government has moved forward with plans that have sparked debate among financial experts.

Villeroy de Galhau recently expressed concern that the U.S. push for crypto and non-bank financial services could lead to major disruptions. According to him, financial crises often begin in the U.S. and impact global markets. By integrating crypto further into the financial system, Trump may be laying the groundwork for future instability.

A recent executive order from Trump announced the creation of a Strategic Bitcoin Reserve, sparking debate about government involvement in digital assets. This move, along with a proposed executive order to reverse Operation Choke Point 2.0—a policy restricting crypto firms' access to banking services—signals a major shift in U.S. financial policy. However, critics argue that such actions increase risks for both investors and traditional banks.

These policies have already made an impact. Last week, Bitcoin’s price dropped below $85,000 following Trump’s executive order, leading to $250 million in liquidations. The event highlighted the high volatility of crypto markets and raised concerns about the potential risks of government-backed investments in digital assets.

Prominent critics include economist Peter Schiff, a long-time Bitcoin skeptic, who has openly condemned Trump’s Strategic Bitcoin Reserve. Schiff labeled it “the biggest crypto rug pull of all time,” warning that it could lead to market manipulation and financial losses for regular investors. His concerns reflect broader fears that such policies may benefit insiders while exposing taxpayers to unnecessary risks.

A recent survey revealed that most American voters oppose Trump’s push for a national Bitcoin reserve. Many fear that taxpayer funds could be misused on a volatile asset, especially given the recent swings in Bitcoin’s value. This public sentiment could create challenges for the administration as it pushes ahead with its crypto agenda.

Meanwhile, Europe is taking a more cautious approach, aiming to strengthen its financial stability in response to U.S. policy shifts. De Galhau has urged the European Union to reinforce the euro’s global role and establish a robust savings and investment framework. His message is clear—Europe must act decisively rather than passively accept the consequences of U.S. financial policies.

Beyond crypto, France is also closely watching Trump’s new trade tariffs, particularly the 25% duty on European cars. The French government sees this as part of Trump’s aggressive economic strategy, which views global trade as a zero-sum game. De Galhau believes Europe must assert itself and negotiate from a position of strength rather than simply react to U.S. actions.

As Trump continues to push for a crypto-friendly financial system, the global debate over digital assets remains heated. Supporters see this as a step toward financial innovation, while critics warn of instability, market manipulation, and the risks of excessive government involvement in volatile assets. With market fluctuations intensifying and regulatory uncertainties growing, the future of cryptocurrency in national economies is far from settled.