Fabio Panetta, former European Central Bank official and Governor of the Bank of Italy, emphasizes the need for a digital euro to navigate the risks associated with cryptocurrency adoption. His remarks, outlined in the Bank of Italy’s annual report released on May 30th, highlight the significance of central bank digital currency (CBDC) for ensuring financial stability. Panetta acknowledges that relying solely on regulations is insufficient to control crypto-asset evolution and stresses the necessity of a central bank-backed digital euro as a key tool in addressing systemic risks. He points out MiCA, the EU’s cryptocurrency regulatory framework, has faced limited success due to the challenges of issuing stablecoins and the potential vulnerabilities posed by platforms based outside the EU. Panetta advocates for stronger global cooperation on regulatory standards and highlights the growing threat of foreign platforms posing risks to European investors.