ECB Executive Board Member Piero Cipollone: Stablecoins May Cause Retail Deposits to Flow Out of the Banking System

Coin Circle (120btc.CoM): Piero Cipollone, a member of the Executive Board of the European Central Bank, warned on July 17 at a banking conference in Rome that if the use of stablecoins continues to expand, the banking system will lose retail deposits as a result. Cipollone delivered a speech titled "The cooperative spirit at the heart of the digital euro," stating, "If the use of stablecoins increases in the future, banks will simultaneously lose retail deposits." Currently, the global stablecoin market has reached approximately $300 billion.

Cipollone's Logic: Outflow of Retail Deposits Weakens Bank Funding Sources

Cipollone's logic is that if stablecoins become mainstream payment and storage tools, retail deposits that are currently held within the banking system will be withdrawn to on-chain wallets, directly undermining the stability of banks' lending and funding sources. The autonomy of the Eurozone's payment infrastructure is relatively weak: currently, two-thirds of credit card payments in the Eurozone use non-European payment channels, and 13 out of 21 Eurozone countries do not have their own national payment card systems.

Euro Stablecoin Legislation: Negotiations Started on July 9, Targeting Agreement by Year-End, Launching in 2029

Cipollone's warning coincides with the legislative negotiations for the EU stablecoin legislation—EU member states and the Commission officially launched discussions on the stablecoin legislation on July 9, aiming to reach an agreement by the end of 2026, with the first issuance of the digital euro expected in 2029. Currently, there are 36 payment service providers participating in the digital euro pilot.

Mobile Payment Penetration: Netherlands, Ireland, and Finland Reaching 10% of POS Transactions

Cipollone also cited changes in the current payment structure: in Eurozone countries such as Ireland, the Netherlands, and Finland, mobile payments account for over 10% of physical POS transactions—indicating that consumer behavior is already shifting towards digital payments. Cipollone's position is that the EU needs to produce clear legislative outcomes on the stablecoin legislation and accelerate the promotion of the digital euro project to maintain the autonomy of the euro payment system.

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