Stablecoins $300B boom: ECB's crisis alert for Europe

Dollar stablecoins explode to $300B – ECB sounds alarm on crisis potential.

The global stablecoin market reached $300 billion by November 2025. It grew 48% since January. U.S. regulatory clarity under the GENIUS Act drove the expansion. Dollar-pegged tokens dominate with 99.58% market share. Euro-denominated stablecoins remain marginal at $549 million (0.18%). Leading issuers hold most reserves in U.S. Treasuries.

ECB risk assessment

The European Central Bank warns that a large-scale run on dollar stablecoins could force mass sales of underlying Treasuries. This would disrupt European reserve management and monetary policy transmission. The European Systemic Risk Board (ESRB) highlights contagion channels through offshore exposures. Multi-issuer models involving non-EU partners create additional gaps. Economist Jean Tirole flagged the risk of future taxpayer-funded rescues.

Regulatory countermeasures

The ESRB recommends banning joint stablecoin issuance between EU and non-EU entities. The European Commission plans to shift MiCA supervision to the European Securities and Markets Authority (ESMA). Nine major European banks prepare a regulated euro stablecoin for launch in the second half of 2026. The ECB continues preparatory work on its digital euro, targeting a 2029 rollout.

“If stablecoins in the US increase at the same pace as they have been increasing, they will become systemically relevant at a certain point.”— Olaf Sleijpen, Dutch Central Bank Governor

Strategic outlook

Europe seeks to reduce reliance on dollar-denominated digital assets. Tighter rules may slow innovation compared to the U.S. The ECB views stablecoin restrictions as complementary to the digital euro project. International regulatory coordination remains under discussion.