BlockBeats News, May 8th - According to Bloomberg, European Central Bank President Christine Lagarde recently issued a warning regarding Euro-denominated stablecoins, stating that they may pose significant risks to financial stability and monetary policy transmission, and questioning the necessity of introducing such tools.

In a speech in Spain, Lagarde stated that the reasons for supporting Euro stablecoins are "much weaker than they appear." She pointed out that these assets are prone to runs during market turmoil, which would weaken the European Central Bank's ability to reach every corner of the economy through interest rate policy.

Lagarde acknowledged that Euro stablecoins could help lower financing costs in the Euro area and enhance the Euro's global attractiveness, but she emphasized that this benefit is short-term, with the cost being a "significant" trade-off. She explicitly stated, "If we want to enhance the international attractiveness of the Euro, stablecoins are not an effective path."

Lagarde also mentioned a working paper published by the European Central Bank in March, which warned that widespread adoption of stablecoins would pose significant risks to the Euro area banks and the European Central Bank's monetary policy sovereignty, especially stablecoins pegged to currencies such as the US Dollar.

Despite Lagarde's skepticism, several large Euro area banks are still advancing Euro stablecoin projects, including France's Societe Generale, which has launched EUR CoinVertible, and the Qivalis Alliance supported by institutions such as the Netherlands' ING Group and Banco Santander of Spain, which also plans to issue a Euro stablecoin later this year.