ECB Warns of Stablecoin Risks to Financial Stability

The European Central Bank (ECB) has issued warnings about the potential risks posed by the rapid growth of stablecoins, highlighting their impact on financial stability in Europe. Key concerns include the possibility of liquidity crises linked to stablecoin usage and its connection to traditional finance. Olaf Sleijpen, President of De Nederlandsche Bank, believes unstable stablecoins could necessitate a shift in monetary policy due to potential asset sales triggered by market volatility.