As the United States and the Trump administration strive to position themselves at the forefront of Bitcoin and cryptocurrencies, crafting a comprehensive strategy, Europe is embarking on a mission to reshape the very foundations of money. Their goal is to uphold the dominance of the euro in the region, with aspirations of integrating it into blockchain technology. As stablecoins gain traction worldwide and blockchain markets evolve, Spain’s central bank provides insight into the Eurosystem’s strategy to maintain its monetary sovereignty, adapt public currency for a tokenized future, and avert the unintended consequences of private digital currencies on Europe’s financial framework. “One of the primary roles of Spain’s central bank is to ensure the stability of the financial system and the effective operation of national payment systems. In line with this mandate, together with other central banks of the Eurosystem, we are exploring the potential offered by new technologies such as blockchain,” José Manuel Marqués told in an interview. This involves examining the various applications, advantages, and potential risks associated with this technology, while being prepared to comprehend and engage as financial markets increasingly adopt distributed technologies. It is essential to maintain the vital function of central bank money as a settlement asset without alteration. This goal is one that resonates across the various members of the European Union.
Marqués states that the Eurosystem is pursuing two complementary lines of action: the digital euro project, aimed at the retail space, and the Pontes project, which aims to establish connectivity and interoperability between distributed ledger technology platforms and services by the end of 2026. He also highlighted the Appia project, which aims to investigate the potential development of an integrated platform where tokenized central bank money can coexist alongside other tokenized financial assets and various forms of private money. In this context, Eurozone nations, with Spain taking a leading role, are examining the implications of stablecoins for the future of the euro and the digital euro. This scrutiny is particularly relevant for stablecoins pegged to other currencies, such as the dollar. “As they may have significant and unintended consequences both in terms of monetary sovereignty and by generating dependencies that could ultimately prove critical to the normal functioning of the economy,” Marqués detailed. “We believe it is essential to have an appropriate legal framework that provides safeguards equivalent to those we have traditionally enjoyed in the conventional financial system, which is, in fact, achieved through the MiCA regulation.” “Likewise, we consider it fundamental to ensure the continuity of a two-tier monetary system in which central bank money continues to play a key role as a risk-free settlement asset and as a guarantor of the singleness of money,” Marqués argued.
Spain’s central bank is actively involved in the digital euro project, collaborating with the European Central Bank and other central banks within the Eurosystem. Marqués stated that the goal of this initiative is to enhance physical cash, ensuring that citizens and businesses can make payments securely without dependence on non-European providers. It aims to uphold the balance between public money, issued by central banks, and private money, which is crucial for maintaining trust and the effective operation of the financial system. Spain’s central bank Director of the Department of Market Infrastructures and Innovation clarified that the goal is not to replace deposits or current payment solutions, but rather to establish a complementary system utilizing the same currency. The rollout of the digital euro is set to adopt a non-disintermediated distribution model, meaning that users will receive the digital euro via payment service providers. “Consequently, any entity—whether a traditional institution or a new market entrant—that is authorized as a credit institution, electronic money institution, or payment institution will be able to offer its customers digital euro accounts and services, thereby contributing to the success of the project,” Marqués detailed. On October 30, the preparation phase that commenced in November 2023 reached its conclusion, paving the way for the launch of a new phase of the project.
Spain’s central bank is actively engaged in the European Blockchain Sandbox to further develop strategies and initiatives surrounding crypto-assets and blockchain applications. Marqués characterized this experience as “very positive,” a sentiment echoed by other nations within the Eurosystem. This sandbox is fundamentally designed to create a framework that facilitates regulatory dialogue between authorities and companies concerning blockchain-based use cases. This initiative extends beyond the financial sector, involving various sector-specific European regulators and supervisors, along with cross-cutting entities like data protection authorities. “The European Blockchain Sandbox has made it possible to foster public-private collaboration and has served as a means to gain insight into innovative use cases, as well as to participate in discussions with other financial and non-financial authorities, both Spanish and European,” Marqués detailed. In Spain, several intriguing private-driven initiatives are underway to embrace blockchain technology. For instance, BBVA provides its clients with the opportunity to acquire and custody bitcoin and ETH. Meanwhile, the Spanish bank CaixaBank has partnered with a European consortium called Qivalis to introduce a euro-linked stablecoin in 2026. For Spain’s central bank, this initiative signifies that a notable interest is starting to emerge in the sector. “As a result, in addition to maintaining initiatives aimed at becoming familiar with these technologies, an increasing number of institutions are seeking to formulate practical proposals through which they can begin to generate returns on their investments,” Marqués explained. This is particularly relevant for Spain, but it also extends to the Eurosystem as a whole, given the existing legal framework within the EU. In pursuit of this goal, central banks are exploring ways to align their infrastructures with innovations like distributed ledgers and various blockchain applications that may emerge from European nations.
“We believe it is very positive that initiatives in this field are proliferating as a way to maintain—or even enhance—European competitiveness and safeguard the international role of the euro,” Marqués emphasized. Projects that align with the objectives of central banks are certainly welcomed within the financial ecosystem. Particularly, when the projects originate from established and overseen entities such as commercial banks. With Europe establishing a definitive legal framework, the private sector is encouraged to delve into the opportunities this domain presents. “This is a dynamic market that undoubtedly offers the possibility of developing new business lines, and therefore, once uncertainties regarding the applicable regulation have been resolved, this is an appropriate moment for the private sector to continue demonstrating its capacity to innovate and improve its range of products and services, without compromising financial stability,” Marqués stated. Amid the rising global interest in dollar-denominated stablecoins and the various approaches to blockchain and cryptocurrencies by major nations, Spain’s central bank, along with other European central banks, is prioritizing the resilience of its local currency. Their efforts are aimed at maintaining the euro’s dominance while adapting to the technological advancements of the digital age through the development of the digital euro.