Safeguarding Europe's Payment Systems in a Digital Age

Amid accelerating digitalization and a shifting geopolitical landscape, the stability and autonomy of euro payment systems are under increasing scrutiny. Recent years have seen a surge in digital payments and the emergence of tokenized financial assets, with non-European—especially American—players dominating much of the underlying technology and infrastructure. This has heightened concerns about Europe’s strategic dependence and vulnerability to cyber risks, as well as the potential erosion of monetary sovereignty, particularly with the growing presence of dollar-backed stablecoins in European transactions.

Addressing these risks, the Banque de France is spearheading efforts to fortify the euro’s financial ecosystem on three main fronts. First, it is enhancing the regulatory environment by advocating robust frameworks for both consumer protection and the responsible development of cryptoassets; recent regulations such as PSD2, upcoming PSD3, and calls for stronger rules on non-European stablecoins exemplify this approach. Second, the central bank is actively modernizing its own services, launching projects such as the digital euro, which aims to preserve Europeans’ choice between public and private money, as well as the innovative Pontes and Appia initiatives, designed to support tokenized asset transactions and post-trade infrastructures using blockchain technology. Lastly, the Banque de France recognizes the vital role of private sector contributions, emphasizing the need for reliable, euro-denominated payment and settlement solutions from regulated financial intermediaries. Collaborative ventures—like the European Payments Initiative and the development of tokenized deposits and euro stablecoins—are integral to maintaining a flexible, secure, and autonomous system.

The transformation of Europe’s payments landscape brings significant progress but also profound challenges to monetary and financial stability. Meeting these challenges will require cohesive action from both public institutions and private companies to ensure the euro’s continued resilience, security, and strategic independence in a rapidly evolving global financial environment.