European lawmakers silent on US Bitcoin reserve amid digital euro push
European lawmakers have notably refrained from public commentary regarding the United States’ recent Strategic Bitcoin Reserve initiative, a significant policy that appears to favor early Bitcoin adopters. On March 7, 2023, former President Donald Trump signed an executive order detailing a plan to establish a Bitcoin reserve, which would use cryptocurrency obtained through seizures in criminal cases, rather than purchasing Bitcoin directly from the market.
This unprecedented move highlights a pivotal shift in how national reserves could integrate cryptocurrencies. However, European policymakers have not yet articulated a clear stance on Bitcoin’s role within national reserves, prompting speculation about their intentions or lack thereof in this evolving financial landscape. Anastasija Plotnikova, the co-founder and CEO of blockchain regulatory firm Fideum, noted the complexity involved in adding new asset classes to national treasuries. According to her, the process is generally governed by specific legislative or executive measures, which often lack active support from voters or central banks necessary for such changes.
The European Central Bank (ECB) has historically been critical of Bitcoin as a reserve asset, which could further stifle discussions among EU member states about adopting similar policies. Instead, attention has shifted towards the launch of the digital euro, a central bank digital currency (CBDC) that is currently in development.
This focus on the digital euro could be one reason behind the European lawmakers’ silence regarding the U.S. initiative. James Wo, founder and CEO of venture capital firm DFG, explained that the ECB’s firm opposition to holding Bitcoin in its reserves indicates a prioritization of the digital euro over Bitcoin-related initiatives. He also expressed concern about the ECB’s ability to effectively manage a new digital currency amidst operational challenges, such as the recent outages experienced in its Target 2 (T2) payment system.
Despite skepticism surrounding the digital euro, ECB President Christine Lagarde remains committed to its planned launch in October 2025. In a recent press conference, Lagarde emphasized that the CBDC will coexist with cash while providing privacy protections to mitigate public concerns over surveillance. Ensuring that the digital euro maintains a pseudonymous nature akin to cash is a priority in the currency’s design.
The contrasting approaches of the U.S. and the European Union towards digital assets underscore a broader geopolitical divide in financial policy. While the EU moves towards implementing a centralized digital currency that aims to enhance financial inclusion, critics raise alarms about potential government overreach and monitoring capabilities associated with CBDCs. For example, a recent analysis of Brazil’s CBDC pilot revealed alarming surveillance mechanisms capable of freezing or limiting user funds within digital wallets.
As the world observes these developments, it remains evident that the dialogue surrounding cryptocurrencies and digital assets will continue to evolve, with each region shaping its own narrative and regulatory framework in the face of technological advancement.
