The article examines the reaction of Europe to stablecoins, drawing parallels to the U.S. Strategic Defense Initiative (SDI) during the Cold War. President Trump’s claim that stablecoins will bolster the dollar’s status as the global reserve currency has alarmed European officials, leading them to reconsider their plans for a digital euro. Instead of a private blockchain, EU officials are contemplating a public blockchain like Ethereum or Solana, a significant shift given existing restrictions on cash transactions in many European countries. Concerns about stablecoins include their potential to undermine Europe’s banking system and create a geopolitical dependency. The article argues that while the U.S. fears the influence of stablecoins, Europe’s strong reaction suggests they perceive them as a real threat, akin to SDI, as they navigate the complexities of creating a competitive digital euro without disadvantaging traditional bank deposits. The outcome may reflect a persistent dilemma where Europe fears instability from stablecoins but remains cautious about the advantages of a CBDC.

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