The European Central Bank (ECB) has expressed serious concerns over the growing support for US dollar-backed stablecoins, arguing that new US legislation could trigger a significant capital shift from Europe to American digital assets. Their warning comes as two proposed bills in the US, STABLE and GENIUS, aim to expand the use of these stablecoins. The ECB fears this regulatory push could weaken the euro’s position globally, causing liquidity stress in European banks. The ECB has urged adjustments to EU crypto rules, citing potential vulnerabilities under existing MiCA regulations. Meanwhile, the European Commission maintains that current EU laws already effectively manage stablecoin risks and issuer limits. This clash of perspectives has led to divided opinions within the EU, with most member states not supporting immediate changes despite the ECB’s urgent call for action.