A Governor Challenges MiCA and Rekindles the Digital Euro Debate

Italy sounds the alarm! The MiCA law is not enough to regulate the systemic risks related to crypto-assets. For the Governor of the Bank of Italy Fabio Panetta, only a digital euro backed by the Central Bank can indeed secure the rapidly evolving European financial landscape. More details in the following paragraphs!

Ineffective MiCA: Italy advocates for strengthened crypto regulation

The MiCA standards were enacted in June 2023 and came into effect in December 2024. In his annual report, Fabio Panetta believes that this crypto regulation does not stimulate the adoption of compliant stablecoins in Europe.

Since the MiCA law came into force, only a few EMT stablecoins have actually been issued. In Italy in particular, the issuance of these digital assets has remained marginal (despite the growth of crypto custody and trading services).

Even more concerning, crypto regulation via MiCA does not protect investors from risks related to unregulated foreign platforms. Specifically, EU citizens remain exposed to failures of issuers based outside the jurisdiction, as highlighted by Panetta’s report calling for urgent global regulatory cooperation.

The digital euro: a strategic response to the challenges of the crypto financial system

In view of these limitations, the digital euro appears to be a more structuring response. In this sense, Panetta advocates for speeding up the project. The goal: to meet the growing demand for secure and sovereign digital payments.

According to him, only a public digital currency can offer the trust and functionality expected in the crypto world. The explosion of dollar stablecoins confirms this urgency.

Tether’s refusal to comply with MiCA , deemed “dangerous” for the European banking sector by its CEO, only adds to the tensions. The European Union is therefore playing a vital card to:

• its monetary sovereignty;
• its economic stability.

As crypto continues to challenge traditional monetary balances, the digital euro emerges as a key resilience tool. Europe must now move from intentions to action!