Christine Lagarde: Stablecoins and the future of money - separating functions from instruments
Speech by Ms Christine Lagarde, President of the European Central Bank, at the Bank of Spain LatAm Economic Forum, Roda de Bará, 8 May 2026.
It is a privilege to be at Castillo de Bará for the inaugural Banco de España LatAm Economic Forum.
Few developments in recent years have moved from the periphery to the centre of the policy debate as quickly as stablecoins.
Stablecoins have grown from less than USD 10 billion six years ago to more than USD 300 billion today. They are overwhelmingly denominated in US dollars, and nearly 90% of the market is controlled by two issuers – Tether and Circle – based in El Salvador and the United States, respectively.
As their adoption has expanded and their links to the real financial system are deepening, the risks they pose have come firmly into focus, especially as regards financial stability. These concerns have been particularly acute in parts of Latin America and Africa, but they are now firmly part of the policy debate in advanced economies as well.
Europe was early to recognise this. The Markets in Crypto-Assets Regulation (MiCAR) brought stablecoins within the regulatory perimeter in 2024, ahead of developments elsewhere, aiming to contain these risks and safeguard the integrity of the financial system.
In the United States, however, the approach has taken a broader turn. The GENIUS Act is not just a consumer protection and financial stability measure. The US Administration explicitly describes it as a tool to ensure "the continued global dominance of the U.S. dollar" and to cement demand for US Treasuries. The terms of the debate have shifted with it. It is no longer about whether stablecoins should exist, but whether jurisdictions can afford to be without them.
The growing argument is that to remain relevant, Europe must respond by promoting euro-denominated stablecoins of its own. Otherwise, it faces a future of digital dollarisation and a loss of monetary sovereignty.
But what this debate has not asked clearly enough is what, precisely, stablecoins are for. The benefits attributed to them rest on two distinct functions – a monetary function and a technological function – that are systematically conflated in the current debate. To navigate clearly, we need to separate them.