The adoption rate of European stablecoins is rising, yet it still struggles to shake the dominance of the US dollar.

Despite the increase in the trading volume of EU stablecoins from 16% in 2024 to 34% in 2025, 99.8% of transactions are still dominated by USD stablecoins. Alexander Hoeptner, CEO of the German euro stablecoin issuer AllUnity, warns that this could undermine the euro's position in digital finance.

To address this challenge, the EU launched the MiCA regulatory framework in December 2024, aimed at promoting the development of euro stablecoins, with the goal of establishing unified rules for capital, redemption, and transparency. Nevertheless, the market share of euro stablecoins remains below 0.2%. Hoeptner from AllUnity stated that Europe needs more incentives to drive the adoption of #euro stablecoins.

Looking at this issue from a deeper level, it actually reveals the structural advantages of the US dollar in the global financial system. Due to the liquidity, widespread use, and long-term dominance of the US dollar, it naturally becomes the preferred stablecoin. Although Europe has a strong currency system and a unified regulatory framework, the lack of a single monetary policy results in insufficient competitiveness of the euro stablecoin.

To address this dilemma, on one hand, the European Central Bank is actively promoting the digital euro project, which is planned to be launched in 2026; on the other hand, it encourages the private sector to issue euro stablecoins that support smart contracts and DeFi functionalities. Hoeptner pointed out that these two forms of digital currency can have a complementary effect, jointly enhancing Europe's digital financial sovereignty.

However, traditional financial institutions have a conservative attitude towards stablecoin innovation, which may slow down the pace of change. Despite the efforts of institutions like the French foreign trade bank to experiment with euro stablecoins, overall development is progressing slowly. Hoeptner warns that if traditional finance does not actively adapt to this change, Europe may become completely reliant on external solutions in the digital finance sector.

Looking ahead, for Europe to promote the comprehensive adoption of the euro stablecoin, it must first ensure a smooth integration of the MiCA regulatory framework with traditional financial regulation, while also facilitating the coordinated development of the digital euro and private sector stablecoins, with the aim of establishing a solid public-private partnership.

Whether these measures can effectively reduce Europe's dependence on the US dollar will depend on the strength of policy implementation and the level of market acceptance. In the current geopolitical environment, this challenge is not only related to economic interests but also involves the core issue of monetary sovereignty in the digital age.