Digital Euro: A Necessary Tool For Managing Crypto Risks Amidst EU Regulations

Bank of Italy Governor Fabio Panetta’s recent annual report advocates for the creation of a digital euro as the primary tool for mitigating cryptocurrency risks, arguing that regulations alone cannot address systemic dangers posed by digital assets. Instead, a central bank-backed digital euro would offer necessary trust and functionality within the evolving payment landscape. This stance emerges as MiCA regulation, designed to govern EU crypto markets, enters full effect in late 2024. Panetta emphasizes the need for digital euro development to maintain financial stability and meet demand for secure digital payments.