Dollar Stablecoins Bigger Threat Than Trump Tariffs: Italy’s Finance Chief

Italy’s Minister of Economy and Finance, Giancarlo Giorgetti, has issued a stark warning that U.S. dollar stablecoins may pose a greater threat to the eurozone’s financial stability than U.S. trade tariffs.

Speaking at an event in Milan, Giorgetti cautioned that the increasing use of U.S. stablecoins by Europeans could undermine the international role of the euro, eroding the EU’s economic sovereignty and global financial influence.

US Dollar Stablecoins More Harmful Than Tariffs

While tariffs—such as those recently imposed by Donald Trump—often dominate political discourse, Giorgetti argued that the quieter rise of U.S. dollar stablecoins represents a more serious long-term challenge. 

These digital assets, pegged to the U.S. dollar, offer a convenient solution for cross-border payments, often without the need for a traditional U.S. bank account.

Also read: JPMorgan Bets on GBP to Break Dollar Dominance in Digital Payments

As first reported by Reuters, Giorgetti emphasized that the growing popularity of these coins in Europe could diminish demand for the euro in global trade and increase European reliance on financial instruments governed by U.S. regulations.

The EU’s Digital Euro Push

To counter this trend, Giorgetti urged the European Union to accelerate the development of the digital euro—an initiative spearheaded by the European Central Bank (ECB). 

Though still in progress, the digital euro is viewed as a crucial tool to safeguard monetary sovereignty and boost the euro’s role in international finance.

Echoing this urgency, ECB Executive Board member Piero Cipollone published a commentary on April 8 warning against dollar-dominated digital finance and stressing the strategic need for a European digital currency.

Also read: The Digital Euro Dilemma: ECB Faces Consumer Reluctance

U.S. Lawmakers Push Stablecoin Regulation

Meanwhile, U.S. legislators are advancing a regulatory framework for stablecoins. On April 2, the House Financial Services Committee approved the STABLE Act (Stablecoin Transparency and Accountability for a Better Ledger Economy), which would require stablecoin issuers to disclose how their tokens are backed and comply with financial safeguards.

Alongside it, the GENIUS Act (Guiding and Establishing National Innovation for US Stablecoins) proposes additional measures including one-to-one reserve backing, anti-money laundering compliance, and consumer protections.

Both bills are aimed at strengthening the U.S. dollar’s position in the evolving digital financial landscape. The legislative efforts show that stablecoins are not merely about cryptocurrency—they are central to broader issues of global monetary influence.

Also read: ECB’s Francois Villeroy Warns: US Crypto Policy a ‘Time Bomb’?

With dominant U.S. dollar stablecoins like USDC and USDT already in wide circulation, Europe’s ability to shape the future of digital finance may depend on how swiftly it can respond with its own alternatives. 

Top 5 biggest stablecoins by market cap (Source: CoinMarketCap)

In an era where monetary power transcends borders, digital currencies could redefine geopolitical dynamics.