The European Central Bank rejected the proposal to issue a euro stablecoin, believing the risks are too high

According to a report by Reuters, three sources revealed that the European Central Bank warned EU finance ministers on Friday that proposals to issue more euro stablecoins could reduce bank lending and make interest rate control more difficult. The Brussels-based economic think tank Bruegel prepared a report for the EU's top financial policymakers, calling for a relaxation of liquidity requirements for cryptocurrency issuers and possibly allowing them to access funding support from the European Central Bank. The aim is to develop the stablecoin market in Europe, which is currently dominated by dollar tokens.

However, sources said that other central bank officials, including European Central Bank President Christine Lagarde, immediately opposed this. They are concerned that such measures would make bank deposits more unstable, weaken this sector that is crucial to the economy, and reduce the central bank's ability to regulate interest rates.