Bank of Italy Chief Advocates for Digital Euro Amid Crypto Risks

Fabio Panetta, Governor of the Bank of Italy, has urged the European Union to accelerate the launch of a digital euro, positioning it as a strategic countermeasure against the unchecked growth of cryptocurrencies and regulatory fragmentation. His remarks, tied to the central bank’s annual report, emphasize the limitations of existing frameworks like MiCA in curbing stablecoin proliferation or fostering sustainable industry development in Italy.

The former ECB executive warned that offshore crypto platforms pose systemic risks, leaving European consumers exposed to potential failures abroad. Panetta’s push aligns with broader ECB concerns over dollar-denominated stablecoin dominance, a trend flagged by board member Piero Cipollone as requiring urgent public-sector alternatives.

Tether’s rejection of MiCA compliance has further complicated the regulatory landscape, with the stablecoin issuer arguing the rules disadvantage smaller European banks. The debate unfolds as global jurisdictions race to establish sovereign digital currencies that can match private-sector innovation while maintaining monetary sovereignty.