Derived from CoinEdition, the European Central Bank (ECB) has issued a warning that the rapid global expansion of stablecoins could pose financial stability risks if left unchecked. The total stablecoin market has surpassed $280 billion, with USDT and USDC dominating nearly 90% of the supply. While euro-denominated stablecoins remain marginal at €395 million, the ECB highlights growing links to traditional finance and regulatory gaps as key concerns. The central bank also notes that stablecoins are primarily used for crypto trading rather than mainstream payments, and warns that a sudden run on major stablecoins could strain Treasury market liquidity. With stablecoins projected to reach $2 trillion by 2028, the ECB calls for coordinated global regulation to address cross-border loopholes and mitigate risks.
ECB Warns of Stablecoin Growth Risks Amid $280B Market Surge
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