Trump's crypto plans have caused tension in Europe: Warning from the ECB

The intense support given by U.S. President Donald Trump to the crypto sector has brought the European Central Bank (ECB) and the European Commission face to face. According to a report by Politico, there has been tension between the two sides regarding whether the legislation regulating the crypto sector in Europe, known as MiCA, is robust enough to withstand Trump’s moves.

The European Central Bank, led by Christine Lagarde, argues that the generous incentives provided by the Trump administration to the crypto sector in the U.S. pose a "financial contagion" risk that threatens the European economy. It has emerged that the bank is calling for this legal regulation, which came into effect only four months ago, to be "urgently" rewritten.

In contrast, the European Commission rejected this "alarmist" analysis of the European Central Bank, claiming that the bank misunderstood EU rules, and emphasized that it saw this as an unwanted intervention in the legal process.

According to Politico, this disagreement reveals how uneasy European financial regulators generally are in the face of the Trump administration's efforts to expand the dollar's influence through crypto.

ECB President Christine Lagarde and the bank's board member responsible for digital payments, Piero Cipollone, have recently drawn attention with their warnings. Both senior officials expressed that MiCA may not show sufficient resistance against a rapidly growing US stablecoin sector, and that assets denominated in dollars could flow into the European market, causing EU savings to escape to the US. In a statement made last week, Lagarde noted that stablecoins pose a unique threat and stated that MiCA needs to be revised.

Published: April 22, 2025 23:32 Last Updated: April 22, 2025 23:37