Bundesbank President Joachim Nagel backs euro stablecoins and retail CBDC, highlighting Europe’s drive for secure, efficient, and independent digital payment systems.

Germany’s central bank leadership expressed support for digital payment innovation this week. Joachim Nagel signaled approval for euro stablecoins and a retail CBDC. The comments underscored Europe’s ongoing effort to modernise and strengthen its payment systems to ensure they remain independent and reliable.

Bundesbank Chief Highlights Digital Euro and Stablecoins

Speaking at the American Chamber of Commerce in Germany’s reception, Nagel discussed economic transitions. He said policymakers were working hard to bring about a retail digital euro. Additionally, he explained that euro-denominated stablecoins were tools that made efficient cross-border transactions possible.

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Nagel said Europe needs to reinforce independence in terms of payment systems and financial solutions. As a result, digital currencies and regulated stablecoins received renewed attention from institutions. The speech defined technology’s role as central to financial stability and long-term economic competitiveness.

Trade links between the European Union and the United States remained economically important. Nearly 20 percent of German exports to non-EU countries still poured into the American markets. Together, both economies accounted for 30% of the world trade and 44% GDP.

Nagel noted that geopolitical fragmentation was a growing weight on the growth outlook in Europe. However, he emphasized that Europe still had a strong belief in open and rules-based commerce. Therefore, regulatory simplification and investment became urgent strategic priorities of the policymakers.

He was in favor of simplifying complex regulatory rules that discouraged business expansion and innovation. Moreover, European Commission initiatives were aimed at reducing administrative burdens in member states. Such reforms, he argued, could unlock investment, efficiency and productivity gains.

Stablecoins and Wholesale CBDC Seen as Payment Catalysts

Nagel pointed out work studied for an exploratory central bank digital currency. This model would allow for programmable payments in safe central bank money. Financial institutions could reap benefits from improved speed of settlement and lower operational risks.

Alongside CBDCs, Nagel came out firmly in favour of euro-denominated stablecoin adoption. He said such assets have the potential to reduce costs for individuals and businesses. Importantly, cross-border payments could potentially become faster, cheaper, and more accessible.

The president of the Bundesbank connected these efforts with the overall competitiveness strategy of Europe. Furthermore, he underlined the need for a stronger investment in digital and energy infrastructure. Private capital, he pointed out, would play a decisive supporting role.

Nagel’s comments were a sign of gathering momentum for the regulated digital assets. Meanwhile, debates were raging over design decisions, privacy protections and financial stability implications. Still, policymakers were increasingly beginning to see innovation as inevitable in the modern payment ecosystems.

Europe’s independence in the payment sphere was a recurring theme among central bankers. As a result, the stablecoins and CBDCs were discussed as complementary and not competing solutions. This view was consistent with wider European digital finance policy goals.

Nagel concluded that Europe must do its adaptation confidently in the face of a changing world environment. He promoted dialogue, cooperation, and pragmatic reforms in favour of sustainable economic resilience. Ultimately, digital euro initiatives and stablecoins can transform payments in Europe in the future.

The speech attracted the headlines of financial markets as well as technology policy observers. However, officials emphasized that development schedules would be dependent on legislative progress. Consultations across the institutions were expected to inform the careful shaping of the implementation frameworks.

Europe’s digital payments landscape seemed destined for slow but significant change. Consequently, policymakers, banks, and firms planned to change technological standards. Nagel’s position supported expectations about continued experimentation with digital money and broader innovations.