The following is a guest post and an opinion of Eneko Knörr, CEO and co-founder of Stabolut.
The Markets of the European Union in the regulation of Crypto Assets (MICA) was intended to determine clarity and safety in the crypto landscape. Yet paradoxically, the overly restrictive attitude towards the euro-connected Stablecoins could unintentionally guarantee the constant dominance of the US dollar in global financing.
Stablecoins have become indispensable in the global digital economy, which makes fast, transparent and grenzo transactions possible. Currently, More than 99% of the Stablecoin market is linked to the US dollar. Instead of challenging this monopoly, Europe’s Mica Regulation makes it increasingly difficult For the euro -supported Stablecoins to get a considerable traction.
Although it explains openly: “We don’t want to be stablecoins, because we would like to push our CBDC” confronted with serious criticism, Mica smartly achieves the same result imposing Such strict legal restrictions that Euro-Stablecoins become practically unfeasible.
The effect is subtle and yet clearly Mica effectively suppresses private euro-stable coin innovation in favor of a digital currency of the central bank. This regulatory environment has unintentionally given a big advantage to USD-Stablecoins, Strengthen the position of the US dollar As the world’s primary transactional currency. Despite stories about the falling dollar dominance, Stablecoins feed a renaissance For USD, it embedded deeper into the worldwide financial tissue.
Interestingly, this happens at a time when Brics -countries and even the EU themselves actively try to challenge the dominance of the US dollar in the world markets. Ironically, however, the importance of stablecoins increases dramatically as global trade increasingly goes to blockchain-based transactions.
Strong USD-supported Stablecoins will play a crucial role to ensure that the dollar enforces the worldwide market share or even expands.
The ambition of Europe to elevate the euro via a CBDC, on the other hand, completely lacks the goal. The conviction of the EU that a euro CBDC will succeed and will significantly improve the worldwide influence of the euro is not only misled, but also naive.
A CBDC may seem innovative on paper, but history suggests that the government led initiatives to match the creativity, efficiency and adaptability of innovation in the private sector. In addition, CBDCs express inherent concern about privacy, government respect and autonomy of the consumer.
It is really sad to realize that Europe is missing this critical point.
The US seems to clearly understand this dynamic. By opposing the temptation to launch a federal CBDC and instead promoting private stablecoins, American supervisors ensure that innovation remains fast, market -driven and worldwide.
The misstep of Europe with Mica is not just a missed economic opportunity; It is a strategic error that could have in -depth geopolitical implications. By choking Euro-Stablecoins, Europe accidentally strengthens the dominance of the USD at exactly the moment when a viable, globally accepted Euro-Stablecoin could offer meaningful competition and diversity.
Although policymakers may believe that they protect the financial system, they actually build a regulatory canal around irrelevance. While the adoption of crypto is accelerating worldwide, capital, talent and innovation flows into jurisdictions that embrace experiments. The cautious over -range of Europe risks to turn it into a spectator in the next era of financial infrastructure – come from the sidelines while others write the rules.
If Europe takes the global status of the euro seriously, it must reconsider its approach. The future of money is likely to be formed by those who empower innovation instead of those who limit it. Unfortunately for Europe, Mica might be the best thing that has ever happened to the US dollar.
