The governor of the Bank of France mentioned that Europe cannot afford to lose momentum in solving the challenges caused by international digital assets private sector.
He has issued this warning after the governments of five countries such as Germany, France, Italy, Spain and the Netherlands have supported the initiative of the European Commission on the draft law related to asset-backed crypto assets, especially stablecoins.
In their draft joint statement, the five governments mentioned the necessity to prevent global stablecoins from operating in the EU before all legislation formalities are settled. The proposals should be approved next month.
During his saying at the Bundesbank conference on Sept. 11, Banque de France Governor François Villeroy de Galhau mentioned the following:
“We in Europe face urgent and strategic choices on payments that will have implications for our financial sovereignty for decades to come.”
The most imminent risk, Based on Villeroy de Galhau’s point of view, the most significant risk is that “Big Techs,” capitalizing on their global market penetration, will build “private financial infrastructures and ‘monetary’ systems, competing with the public monetary sovereignty since they will position themselves as issuers and managers of a universal ‘currency.’”
Moreover, he warned that countries could face with the overwhelming pressure of private payments assets by issuing their own CBDCs, on domestic and global level —
According to Villeroy de Galhau statement, existing cons in payments, particularly cross-border payments, should be solved from the very beginning by means of public-private initiatives. If this aspect is ignored, private sector global stablecoins will address these drawbacks first and thus set the agenda for the future changes of the digitized economy.
Villeroy de Galhau also mentioned the existing asymmetries in the payments landscape, noting:
“Our European ecosystem has become critically dependent on non-European players (e.g. international card schemes and Big Techs), with little control over business continuity, technical and commercial decision-making, as well as data protection, usage and storage.”