The president of the European Central Depository financial institution (ECB), Christine Lagarde, said that the fiscal institution should be ahead of the curve regarding the demand for stablecoins.

According to a tweet by the ECB on Dec. 12, Lagarde said: "My personal conviction on the consequence of stable coins is that nosotros better be ahead of the curve. There is clearly need out there that we accept to reply to."

Stablecoins are digital currencies pegged to a physical asset or fiat currency and designed to minimize price volatility.

Focus on prompt adaption to fintech innovations

In early September, when Lagarde was notwithstanding the head of the International monetary fund (IMF) and nominee to be the adjacent president of the ECB, she claimed that she would focus on making sure that institutions promptly adapt to the rapidly changing fiscal surround. Lagarde said then:

"In the case of new technologies – including digital currencies – that means beingness warning to risks in terms of financial stability, privacy or criminal activities, and ensuring advisable regulation is in place to steer technology towards the public good. Just it also means recognising the wider social benefits from innovation and assuasive them space to develop."

Afterward in September, the IMF said that stablecoins could bring significant benefits to customers and society simply are not without risks.

The IMF said banks could lose their part as intermediaries, as the public would switch to stablecoin providers. Notwithstanding, it predicted banks would not disappear considering they will likely endeavour to compete by developing their own innovations.

Former ECB presidents' skeptical stance towards crypto

Unlike Lagarde, the ECB's erstwhile president Jean-Claude Trichet recently expressed doubt that cryptocurrencies could ever go the future of money. Trichet also explained that he believes ownership crypto is, in many respects, merely speculation. He also claimed that even when a crypto asset is supposedly backed by a real asset, he still observes a lot of speculation, which he concluded is "not healthy."

Mario Draghi, who served as the president of the ECB prior to Lagarde'due south appointment, said that the European Organisation of Cardinal Banks (ESCB) is closely monitoring developments in the cryptocurrency industry. Despite displaying a positive approach towards new technologies, Draghi manifestly thought that stablecoins and cryptocurrency in full general are of little value.