Crypto Long & Short: Don’t Write Off Euro Stablecoins Just Yet

Core Insights - The emergence of a globally significant euro stablecoin is a logical outcome given the stability of the euro and the size of the euro economy, which processed approximately €2.2 trillion daily in 2023 [1][2] - The shift to tokenized finance is irreversible, and stablecoins are becoming essential infrastructure for financial services, with projections of $30 trillion in tokenized real-world assets by 2034 and up to $5 trillion in tokenized digital securities by 2030 [2][3] - The current euro stablecoin market is small, with only about €600 million in circulation, primarily due to Europe's lack of integration with existing financial infrastructure [3][5] Euro Stablecoin Market - The euro is the second most-active currency globally, yet most financial activity settles in dollars, indicating a need for better infrastructure to support euro stablecoins [3][4] - Stablecoins processed approximately $28 trillion in 2024, surpassing the combined volumes of Visa and Mastercard, highlighting the scale at which stablecoins operate [4] - The dominance of dollar-based stablecoins, which account for around 99% of a $300+ billion market, emphasizes the need for a credible euro stablecoin to compete effectively [5][6] Future Outlook - The next major expansion in stablecoins is expected to focus on a scalable euro stablecoin, which is crucial for the size of Europe's economy [6] - Policymakers and investors are encouraged to consider the optimal mix of on-chain euro options that balances innovation with financial stability [5][6]