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Eurogroup leaders hawk US stablecoins as driver for digital euro
March 12, 2025
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Following a meeting of the Eurogroup of EU finance ministers yesterday, participants promoted the idea that there’s now an urgent need for a European central bank digital currency (CBDC), or digital euro, because Donald Trump wants dollar stablecoins to proliferate worldwide.

While there are valid concerns about monetary sovereignty, several other options exist (see below) to address concerns other than a CBDC.

In fact, the EU’s MiCA regulations and the digital euro were initiated following monetary sovereignty threats from Facebook’s Libra stablecoin. As a result, MiCA includes sovereignty protections, limiting the scale of any single foreign stablecoin for everyday payments. We previously highlighted this when ECB Director Piero Cipollone made similar comments.

The Trump stablecoin threat is being trotted out at a time when legislation for a digital euro still needs agreement. Before last year’s election, the passage of digital euro legislation seemed a foregone conclusion. Approval is still likely, but has hit some road bumps since then.

For example, the person leading the legislative push, the Rapporteur Stefan Berger, stepped aside because of his own skepticism about the CBDC. Hence, the argument that a central bank issued CBDC is the only foil to US stablecoins presents a convenient lever to ensure the smooth progress of legislation.

There appears to be a lack of debate about alternative approaches, some of which are private sector and raise fewer concerns about government control. These options include:

  • being more supportive towards Euro stablecoins, facilitating or encouraging better infrastructure
  • providing better central bank support for pan-European private sector payment initiatives such as Wero
  • coordinating commercial banks to create a tokenized deposit network
  • further tightening MiCA’s already solid sovereignty protections.

Some of these options might be quicker solutions and cost taxpayers less. The digital euro will apparently impose major financial costs on banks.

Our opposition to retail CBDC

We understand that Europe aims to safeguard citizen privacy (with respect to governments) for the digital euro, both at a legal and technical level. We support and believe the stance is genuine.

However, recent events have highlighted that politics can change extremely rapidly. A month ago, the United States was a staunch ally of Europe. Look at the United States’ 180 degree change in stance re cryptocurrency. Perhaps even more relevant is the multiple iterations of Operation Choke Point that de-banked certain groups of people.

Whose to say that European politics won’t change as rapidly as the United States?

Privacy protections can be removed from laws for expedient reasons. And any CBDC design could be altered to share data even more easily.

If a digital euro is established and successful, it’s highly likely that within the next ten to twenty five years it will be used either to monitor citizens – even if it’s for the purpose of ensuring tax compliance – or to restrict how people can spend their money.

In our view, the recent US upheavals don’t just highlight sovereignty issues, but also the enormous dangers of a retail CBDC, given governments and laws change.

We know that the current digital euro architects don’t plan this and we sincerely hope we’re wrong. The only way to be sure is to take the option off the table.

What the ministers said re stablecoins, digital euro

Paschal Donohoe, the Irish Finance Minister and President of the Eurogroup, observed that crypto-asset markets are “evolving very fast, both politically and technologically.”

“We know this is a global market and policy developments in other jurisdictions can have important consequences for us here in Europe. So these discussions are fundamentally linked to our own autonomy and to the resilience of our currency.”

“The digital euro is critical to staying ahead of the curve in this area. A huge amount of technical work has now been done and there is growing appreciation amongst ministers of the importance of this work.”

Pierre Gramegna, Managing Director of the European Stability Mechanism, raised the topic of Facebook’s Libra and Mica:

“What is at stake here is also European Sovereignty. The US administration’s stance on this (crypto) compared to the past has changed. And the US administration is favorable towards cryptocurrency and especially dollar denominated stablecoins, which may raise certain concerns in Europe.”

“It could eventually reignite foreign and US tech giants’ plans to launch mass payment solutions based on dollar denominated stablecoins. If this were to be successful, it could affect the Euro area’s monetary sovereignty and financial stability.”

“Therefore, the ESM supports the European Central Bank’s urgency in making the digital euro a reality to safeguard Europe’s strategic autonomy. The digital euro is today more necessary than ever.”

“We also welcome as ESM and support the initiative of the Commission to relook at the Mica directive which could prove key here to counter the effects we discussed.”

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RIPPLE named one of CNBC's World’s Top Fintech Companies for the third year in a row

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Musk Turns On Starlink to Save Iranians from Regime’s Internet Crackdown

Elon Musk, the world’s richest man and a visionary behind SpaceX, has flipped the switch on Starlink, delivering internet to Iranians amid a brutal regime crackdown.

This move comes on the heels of Israeli strikes targeting Iran’s nuclear facilities, as the Islamic Republic cuts off online access.

The former Department of Government Efficiency chief activated Starlink satellite internet service for Iranians on Saturday following the Islamic Republic's decision to impose nationwide internet restrictions.

As the Jerusalem Post reports, that the Islamic Republic’s Communications Ministry announced the move, stating, "In view of the special conditions of the country, temporary restrictions have been imposed on the country’s internet."

This action followed a series of Israeli attacks on Iranian targets.

Starlink, a SpaceX-developed satellite constellation, provides high-speed internet to regions with limited connectivity, such as remote areas or conflict zones.

Elizabeth MacDonald, a Fox News contributor, highlighted its impact, noting, "Elon Musk turning on Starlink for Iran in 2022 was a game changer. Starlink connects directly to SpaceX satellites, bypassing Iran’s ground infrastructure. That means even during government-imposed shutdowns or censorship, users can still get online, and reportedly more than 100,000 inside Iran are doing that."

During the 2022 "Woman, Life, Freedom" protests, Starlink enabled Iranians to communicate and share footage globally despite network blackouts," she added.

MacDonald also mentioned ongoing tests of "direct-to-cell" capabilities, which could allow smartphone connections without a dish, potentially expanding access and supporting free expression and protest coordination.

Musk confirmed the activation, noting on Saturday, "The beams are on."

This follows the regime’s internet shutdowns, which were triggered by Israeli military actions.

Adding to the tension, Israeli Prime Minister Benjamin Netanyahu addressed the Iranian people on Friday, urging resistance against the regime.

"Israel's fight is not against the Iranian people. Our fight is against the murderous Islamic regime that oppresses and impoverishes you,” he said.

Meanwhile, Reza Pahlavi, the exiled son of Iran’s last monarch, called on military and security forces to abandon the regime, accusing Supreme Leader Ayatollah Ali Khamenei in a Persian-language social media post of forcing Iranians into an unwanted war.

Starlink has been a beacon in other crises. Beyond Iran, Musk has leveraged Starlink to assist people during natural disasters and conflicts.

In the wake of hurricanes and earthquakes, Starlink has provided critical internet access to affected communities, enabling emergency communications and coordination.

Similarly, during the Ukraine-Russia conflict, Musk activated Starlink to support Ukrainian forces and civilians, ensuring they could maintain contact and access vital information under dire circumstances.

The genius entrepreneur, is throwing a lifeline to the oppressed in Iran, and the libs can’t stand it.

Conservative talk show host Mark Levin praised Musk’s action, reposting a message stating that Starlink would "reconnect the Iranian people with the internet and put the final nail in the coffin of the Iranian regime."

"God bless you, Elon. The Starlink beams are on in Iran!" Levin wrote.

Musk, who recently stepped down from leading the DOGE in the Trump administration, has apologized to President Trump for past criticisms, including his stance on the One Big Beautiful Bill.

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GENIUS Act lets State banks conduct some business nationwide. Regulators object

The Senate passed the GENIUS Act for stablecoins last week, but significant work remains before it becomes law. The House has a different bill, the STABLE Act, with notable differences that must be reconciled. State banking regulators have raised strong objections to a provision in the GENIUS Act that would allow state banks to operate nationwide without authorization from host states or a federal regulator.

The controversial clause permits a state bank with a regulated stablecoin subsidiary to provide money transmitter and custodial services in any other state. While host states can impose consumer protection laws, they cannot require the usual authorization and oversight typically needed for out-of-state banking operations.

The Conference of State Bank Supervisors welcomed some changes in the GENIUS Act but remains adamantly opposed to this particular provision. In a statement, CSBS said:

“Critical changes must be made during House consideration of the legislation to prevent unintended consequences and further mitigate financial stability risks. CSBS remains concerned with the dramatic and unsupported expansion of the authority of uninsured banks to conduct money transmission or custody activities nationwide without the approval or oversight of host state supervisors (Sec. 16(d)).”

The National Conference of State Legislatures expressed similar concerns in early June, stating:

“We urge you to oppose Section 16(d) and support state authority to regulate financial services in a manner that reflects local conditions, priorities and risk tolerances. Preserving the dual banking system and respecting state autonomy is essential to the safety, soundness and diversity of our nation’s financial sector.”

Evolution of nationwide authorization

Section 16 addresses several issues beyond stablecoins, including preventing a recurrence of the SEC’s SAB 121, which forced crypto assets held in custody onto balance sheets. However, the nationwide authorization subsection was added after the legislation cleared the Senate Banking Committee, with two significant modifications since then.

Originally, the provision applied only to special bank charters like Wyoming’s Special Purpose Depository Institutions or Connecticut’s Innovation Banks. Examples include crypto-focused Custodia Bank and crypto exchange Kraken in Wyoming, plus traditional finance player Fnality US in Connecticut. Recently the scope was expanded to cover most state chartered banks with stablecoin subsidiaries, possibly due to concerns about competitive advantages.

Simultaneously, the clause was substantially tightened. The initial version allowed state chartered banks to provide money transmission and custody services nationwide for any type of asset, which would include cryptocurrencies. Now these activities can only be conducted by the stablecoin subsidiary, and while Section 16(d) doesn’t explicitly limit services to stablecoins, the GENIUS Act currently restricts issuers to stablecoin related activities.

However, the House STABLE Act takes a more permissive approach, allowing regulators to decide which non-stablecoin activities are permitted. If the House version prevails in reconciliation, it could result in a significant expansion of allowed nationwide banking activities beyond stablecoins.

Is it that bad?

As originally drafted, the clause seemed overly permissive.

The amended clause makes sense for stablecoin issuers. They want to have a single regulator and be able to provide the stablecoin services throughout the United States. But it also leans into the perception outside of crypto that this is just another form of regulatory arbitrage.

The controversy over Section 16(d) reflects concerns about creating a regulatory gap that allows banks to operate interstate without the oversight typically required from either federal or state authorities. As the two Congressional chambers work toward reconciliation, lawmakers must decide whether stablecoin legislation should include provisions that effectively reduce traditional banking oversight requirements.

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If you find value in my content, consider showing your support via:

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Dubai regulator VARA classifies RWA issuance as licensed activity
Virtual Asset Regulatory Authority (VARA) leads global regulatory framework - makes RWA issuance licensed activity in Dubai.

Real-world assets (RWAs) issuance is now licensed activity in Dubai.

~ Actual law.
~ Not a legal gray zone.
~ Not a whitepaper fantasy.

RWA issuance and listing on secondary markets is defined under binding crypto regulation.

It’s execution by Dubai.

Irina Heaver explained:

“RWA issuance is no longer theoretical. It’s now a regulatory reality.”

VARA defined:

- RWAs are classified as Asset-Referenced Virtual Assets (ARVAs)

- Secondary market trading is permitted under VARA license

- Issuers need capital, audits, and legal disclosures

- Regulated broker-dealers and exchanges can now onboard and trade them

This closes the gap that killed STOs in 2018.

No more tokenization without venues.
No more assets without liquidity.

UAE is doing what Switzerland, Singapore, and Europe still haven’t:

Creating enforceable frameworks for RWA tokenization that actually work.

Matthew White, CEO of VARA, said it perfectly:

“Tokenization will redefine global finance in 2025.”

He’s not exaggerating.

$500B+ market predicted next year.

And the UAE just gave it legal rails.

~Real estate.
~Private credit.
~Shariah-compliant products.

Everything is in play.

This is how you turn hype into infrastructure.

What Dubai is doing now is 3 years ahead of everyone else.

Founders, investors, ecosystem builders:

You want to build real-world assets onchain.

Don’t waste another year waiting for clarity.

Come to Dubai.

It’s already here.

 

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🙏 Donations Accepted 🙏

If you find value in my content, consider showing your support via:

💳 PayPal: 
1) Simply scan the QR code below 📲
2) or visit https://www.paypal.me/thedinarian

🔗 Crypto – Support via Coinbase Wallet to: [email protected]

Or Buy me a coffee: https://buymeacoffee.com/thedinarian

Your generosity keeps this mission alive, for all! Namasté 🙏 Crypto Michael ⚡  The Dinarian

 

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