Christine Lagarde, the president of the European Central Bank (ECB), emphasizes the need for regulatory measures to address issues surrounding stablecoins issued outside the EU, particularly those that do not adhere to the Markets in Crypto-Assets (MiCA) framework. In her statements at the European Systemic Risk Board conference, Lagarde urged EU legislators to intervene in cases where a non-EU entity collaborates with an EU entity to issue stablecoins. She emphasized that such issuers should only operate within the EU if they provide strong safeguards, ensuring that EU investors can redeem their holdings at par value and that their coins are fully backed. Lagarde noted that investors in case of a financial run would gravitate towards jurisdictions with robust protections, likely favoring the EU. Amid these developments, the U.S. is set to implement a stablecoin framework that may influence global regulations, while China is reportedly considering a stablecoin pegged to its currency to enhance its digital currency strategy.

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