Lagarde Warns Europe Against Copying U.S. Stablecoin Model, Pushes CBDC Path to 2029

ECB President Christine Lagarde used a speech at the Bank of Spain's LatAm Economic Forum in Madrid to argue that Europe should build tokenized settlement infrastructure anchored in central bank money — not replicate the U.S. stablecoin model with privately issued euro-pegged tokens. The global stablecoin market has grown from $10 billion to $310 billion in six years, with nearly 90% controlled by just two issuers, Tether and Circle, and 98% of that market denominated in U.S. dollars.

Lagarde pointed to the March 2023 Silicon Valley Bank collapse — when Circle disclosed $3.3 billion of USDC reserves were held there, briefly de-pegging the stablecoin — as a live example of how stablecoin stress can transmit to underlying asset markets. "The promise of par redemption depends on the very market confidence that can vanish when financial stability deteriorates," she warned, adding that mass…