The European Central Bank said that its proposed digital euro would strengthen Europe’s defenses against cyber and infrastructure disruptions while ensuring broad access to digital payments.

Piero Cipollone, a member of the ECB’s Executive Board, told the European Parliament’s Economic and Monetary Affairs Committee that resilience and inclusiveness must be central features as the bloc prepares to complement physical cash with a central bank-issued digital version.

The remarks marked the ECB’s 14th update to lawmakers on the central bank digital currency project.

Building resilience in payments

Cipollone said Europe’s reliance on foreign payment providers exposes citizens to risks in times of crisis. He cited incidents ranging from undersea cable sabotage in the Baltic Sea to recent power outages in Spain and Portugal as examples of how vulnerable infrastructures can disrupt daily transactions.

He argued that the digital euro would provide “spare capacity” in the financial system by adding public payment rails alongside private solutions.

Planned safeguards include transaction processing across multiple regions, a mandatory ECB-run app to ensure continuity if banks are targeted by cyberattacks, and offline functionality that would allow peer-to-peer payments during power or network outages.

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Ensuring inclusion for all citizens

Cipollone stressed that the digital euro must also serve Europeans at risk of being excluded from a cash-light economy.

He pointed to more than 30 million people in Europe who are blind or partially sighted, at least 34 million who are deaf or hard of hearing, and citizens with limited digital literacy.

The ECB said it is working with consumer groups to design adaptive interfaces, including voice commands and large-font displays, and will require payment providers to support its own app to guarantee basic access.

Local institutions such as post offices and libraries could also provide free support to those least familiar with digital tools.

The European Union has taken yet another step towards a fully regulated crypto landscape. The European Banking Authority (EBA), the EU’s top banking regulator, has released a pivotal news draft framework that outlines how banks manage their exposure to crypto assets.

This also sets stricter capital requirements for banks holding digital assets. However, the new draft of the EBA – falls under the Capital Requirements Regulation (CRR) – provides a green light of regulation to banks who have been hesitant to enter the crypto market due to uncertainty.

On August 5, 2025, EBA published a Final Regulatory Technical Standard (RTS) that specifies the technical elements needed by agencies to calculate and aggregate exposures of crypto assets in relation to the careful treatment of such exposures.

“RTS addresses implementation aspects and ensures harmonization of capital requirements for the exposure of crypto assets by institutions across the EU,” the EBA said.

The EBA has published new risk guidelines for CryptoAssets. EU authorities have set new rules on how European banks can determine and oversee cryptocurrency accounts based on new capital rules related to Basel and MICA https://t.co/IQ07AeHBIW #FundAdmin #custody pic.twitter.com/vrodt7zryh

– Asset service hours (@astimes_) August 6, 2025

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New guidelines will help you create a single, consistent rule for all financial institutions

“The agency shows an increasing interest in participating in code breaking activities,” the EBA said.

According to the EBA, this interest is driven by the potential for new revenue streams and the need to remain competitive.

“Institutions are exploring a variety of roles, including acting as cryptocurrency managers, issuing cryptocurrency and providing related services such as trading and lending on behalf of clients,” the EBA said.

Banks must implement certain detailed risk models for crypto holdings. The EBA draft calls for a strict model to explain, among other things, credit risk, market risk, and counterparty credit risk.

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ESMA outlines a framework for assessing the capabilities of employees in crypto companies

The European Securities and Markets Agency (ESMA) has released new guidelines for assessing the competency requirements of employees working in crypto companies. Furthermore, the new guidelines are consistent with the EU market under the Crypto Deduction Regulation (MICA).

In February, European Watchdog published a consultation paper. According to the paper, the key objective of the draft guidelines is to ensure the minimum level of knowledge and ability of staff to provide clients with advice and information about crypto assets or crypto assets services.

Importantly, the step is to “enhance investor protection and promote investors’ trust in the crypto assets market.”

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We are excited to announce that Kraken has secured a crypto-deduction regulation (MICA) license from the Central Bank of Ireland (CBI) based on the European Union market.

This marks a pivotal milestone in Europe’s expansion, unlocking the ability to scale faster across the region by providing regulated services and directly engaging clients in all 30 EEA countries.

“Along with securing a license from the Central Bank of Ireland, which has a long legacy and experience as a strict financial regulator, it is not just about compliance, but it is a strong signal of Kraken’s commitment to expanding crypto ecosystems through responsible innovation.

“Being the first major global crypto platform licensed by the CBI, we confirm that we affirm Kraken’s commitment to building it in the long run. Trust is the most valuable currency in crypto, and over the past few years we have worked tirelessly to meet CBI’s gold standard expectations. Our secure, accessible, fully regulated cryptographic services service serves millions of people across the EU.”

“We are deeply grateful for the professionalism of the Central Bank of Ireland and the consistent support of the Irish government and IDA. This collaboration is a blueprint for how the public and private sectors can work together to build a safer and more innovative financial future for Europe.

Expanding a strong foundation

Kraken already has Virtual Asset Service Provider (VASP) registrations in major European markets such as Ireland, Belgium, France, Italy, the Netherlands, Poland and Spain. We were the main force in euro-denominated crypto trading, which introduced the first BTC/EUR trading pair in 2013. Today, Kraken’s platform is most liquid and trusted in euro trading, reflecting the region’s deep roots.

Alongside MIFID licenses, where MIFID and EMI licenses are now protected by groups, Kraken is able to extend its regulated services to millions of clients across the EU. Together, these licenses support great growth opportunities across retail, professional and institutional client segments, including spot trading, derivatives, and payments.

For clients, MICA offers additional assurance that Kraken’s services will comply with a consistent set of EU-wide regulatory standards, including stronger consumer protection, greater transparency and robust surveillance, such as enhanced consumer protection, greater transparency and robust surveillance, for Craken to strengthen long-term trust over the long term.

The European Union is preparing to relax its stance on foreign-issued stablecoins, potentially allowing U.S. dollar-backed tokens like USDC and USDT to circulate freely within the bloc, the Financial Times reported on June 25.

According to the report, the European Commission will soon issue formal guidance enabling stablecoins issued outside the EU to be treated as equivalent to their European-registered counterparts.

The move would clear a key regulatory hurdle that has so far limited the reach of dollar-backed stablecoins in Europe’s financial markets.

The shift comes despite repeated warnings from the European Central Bank, which has cautioned that unrestricted access to foreign stablecoins could undermine financial stability.

ECB President Christine Lagarde previously urged policymakers to tighten restrictions on stablecoin issuers, citing the risk of capital flight and reduced monetary sovereignty.

Under the EU’s Markets in Crypto-Assets (MiCA) regulation, stablecoin issuers are currently required to maintain most of their reserves in EU-based banks and ensure euro-denominated redemption rights.

The proposed changes would allow global issuers to bypass those limitations for branded versions of their tokens already operating under EU supervision.

The U.S. Senate’s recent passage of the GENIUS Act, which establishes a national framework for stablecoin oversight, has increased pressure on other jurisdictions to keep pace.

The Financial Times cited several unnamed officials familiar with the matter, who indicated that the Commission’s guidance aims to avoid a scenario in which the EU becomes a “flyover zone” for digital assets, left behind by faster-moving markets in the U.S. and Asia.

The ECB has not publicly commented on the upcoming guidance, but sources told the FT that internal opposition remains strong. EU officials are reportedly working on a compromise that would give national regulators more discretion in assessing the risks associated with foreign stablecoins.

If enacted, the new approach could mark a turning point for the role of U.S. dollar-backed stablecoins in Europe, reinforcing the dollar’s dominance in digital asset markets while signaling the EU’s desire to remain a competitive hub for crypto innovation.

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The European Central Bank (ECB) has quietly given the XRP Ledger a place in its wholesale-DLT sandbox—yet only behind the walls of a closed network. Annex II of the ECB’s June 2025 report describes 48 trials and experiments, but a single project run by Lithuanian fintech Axiology is the only one grounded in its technology.

XRP Ledger Powers ECB Trial

Axiology’s DLT Trading and Settlement System (TSS) is, in the ECB’s own words, a “private, permissioned infrastructure built using the open-source code of the XRP Ledger.” The central bank immediately qualifies that pedigree: “While Axiology benefits from XRP Ledger technology, it operates as an independent system, designed to streamline trading, settlement, and custody of tokenized assets.” In short, the code is XRPL-inspired, but the sandbox itself is hermetically sealed.

The trial rehearsed three events—primary issuance, coupon payments, and maturity redemption—while the Banque de France’s Trigger Solution handled central-bank money. In the issuance phase the ledger recorded that “Node sends asset amount from issuer’s operational wallet to created escrow wallet, which uses XRP Payment transaction,” after which “Operator transfers amount of asset from escrow wallet to final investor’s wallet, using XRP Payment transaction and thus finalizing DVP.”

Later, during redemption, the report shows the flow reversing: “Node sends amount of asset from end-investor wallet to created escrow wallet, which uses XRP Payment transaction,” and finally “Operator transfers amount of asset from escrow wallet to Issuer Agent Operational Wallet using XRP Payment transaction, thereby finalising DVP and initiating burning process.”

Those six sentences—the two structural descriptions plus four transaction steps—are the document’s entire reference set to “XRP.” Nowhere does the annex suggest that the token, open-network validators, or public liquidity pools were involved; every transfer ran strictly inside a permissioned ledger, and the cash side remained pure central-bank money.

Axiology says its goal was to test the “performance and reliability” of synchronizing delivery-versus-payment in central-bank euros with a tokenized bond ledger. For the ECB, the exercise is one of many in a comparative sweep that already includes Canton, Corda, and Ethereum variants. The findings will inform whatever wholesale CBDC architecture the Eurosystem may one day pursue.

The upshot is stark: the ECB did trial Ripple’s technology, but only in a sealed environment, detached from the public ecosystem. For proponents it is a technical validation; for skeptics it shows regulators are still wary of open networks. Either way, the catch remains: the technology was allowed inside the room, yet the door to public adoption stays seemingly firmly shut.

At press time, XRP traded at $2.18, up 13% since the Sunday low at $1.90.

Featured image created with DALL.E, chart from TradingView.com

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Forward-looking: In today’s world and age, having a centralized resource for collecting and sharing information about security vulnerabilities is essential. The US administration recently signaled it doesn’t have this kind of priorities anymore, so the European Union is preparing a potential alternative for keeping the technology world safe and informed.

The European Commission has launched a new vulnerability database managed by the EU Agency for Cybersecurity (ENISA). The beta version of the European Vulnerability Database (EUVD) is already live, promising a more effective approach to cybersecurity and critical information sharing for professionals and organizations across the continent.

The EUVD meets the vulnerability management requirements of the NIS2 Directive, a 2023 framework adopted by the European Parliament to improve cybersecurity in critical sectors like energy, transport, and healthcare. It also helps implement the Cyber Resilience Act, which requires stronger protections for products with digital components.

European officials have described the initiative as a move to strengthen the EU’s technological sovereignty. Henna Virkkunen, the European Commission’s executive vice president for Tech Sovereignty, Security, and Democracy, welcomed the EUVD as a key step toward Europe’s digital security and resiliency.

“By bringing together vulnerability information relevant to the EU market, we are raising cybersecurity standards, enabling public and private stakeholders to better protect our shared digital spaces with greater efficiency and autonomy,” Virkkunen said.

The ENISA says this data consolidation will make it easier for organizations to identify and respond to vulnerabilities, fostering a more proactive cybersecurity environment across the continent. By centralizing and streamlining the information, the EUVD aims to reduce the time it takes to address critical security issues, ultimately enhancing the region’s digital resilience.

The EUVD features three dashboards highlighting critical vulnerabilities, exploited bugs, and “EU-coordinated” flaws. The latter includes issues managed by European CSIRTs. Most data comes from open-source databases, while national CSIRTs provide additional details through advisories and alerts.

Starting September 2026, the EU will require hardware and software manufacturers to report actively exploited vulnerabilities. While Brussels authorities mention the CVE database only tangentially, the EUVD is a practical response to the Trump administration’s attempts to defund critical bug tracking. Should future efforts to slash funding for cyber initiatives succeed, data from the CVE system could seamlessly migrate to the EUVD.

Paolo Ardoino, the chief executive of USDT issuer Tether, thinks many European banks will “blow up” in the coming years.

In a new interview with Pascal Hügli, Ardoino blasts European Union stablecoin regulations, arguing that they increase systemic risk to the economy rather than doing the opposite.

“So remember, their regulation was pushing us to keep 60% of our reserves in uninsured cash deposits in Europe. So let’s make this simple math calculation, right?

Imagine that you have €10 billion in market cap of your stablecoin in Europe. 60% needs to be kept in uninsured cash deposits in a bank. Uninsured cash deposit means that bank insurance in Europe is only €100,000…

Now, of those €6 billion, you know that European banks – well, all the banks – are doing fractional reserves, so they can lend out 90% of it to people that want to buy a house, that want to start a business, or to public works or whatever.

So €5.4 billion will be lent out by the bank and €600 million will be kept…

So imagine that you have a redemption of 20%, so you need to pay out €2 billion. You go to the bank and you tell the bank, ‘Well, I want €2 billion.’

And the bank says, ‘Well, I only have €600 million.’ As a stablecoin issuer, you go bankrupt. Not because of you, but because of the bank. So the bank goes bankrupt and you go bankrupt.”

Ardoino says the regulations are designed to bring liquidity to the banks. He claims that the big financial institutions in Europe won’t bank stablecoins, so stablecoin issuers following EU regulations will be forced to rely on smaller banks with more risk.

According to Ardoino, the setup will lead to a banking crisis in Europe.

“Mark my words, as happened with Silicon Valley Bank, that, by the way, almost killed them in 2023, they will face the same issues. Banks will blow up in the next years also in Europe…

Many banks will blow up in Europe in the next few years.”

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European ETFs recorded $93 billion in net new assets during the first quarter of 2025, marking their highest inflows on record and surpassing the previous high of $91 billion set in Q4 2024.

Per Invesco’s latest European ETF Snapshot, despite largely flat equity returns, rising commodity prices, and solid fixed income gains, pushed total European ETF assets under management to $2.38 trillion by the end of March.

Equities accounted for 80% of Q1 inflows, maintaining pace with the 2024 average. However, Invesco’s data revealed a shift in investor focus, pivoting away from US equities toward European exposures.

ETFs focused on Europe attracted a record $19.4 billion inflows, comprising almost a fifth of the net new assets.

Broad European equity products accounted for $11.4 billion, while German equity ETFs alone captured $5 billion, reflecting heightened investor interest in regional diversification amid global market uncertainty.

CoinShares data for April 18 shows the trend includes European crypto ETPs, notably in Switzerland and Germany, which recorded positive inflows, while US-listed products saw significant outflows.

Switzerland attracted $43.7 million in inflows, and Germany recorded $22.3 million, in contrast to $71 million in outflows from the United States. This divergence supports the analysis of sustained investor preference for European assets and a broader shift away from US exposures across traditional and crypto markets.

However, just-released data from last week indicates a potential recovery in US spot crypto ETFs inflows, though German and Swiss ETP inflows also remain strong.

Appetite for US assets declines

Appetite for US equities has declined as March saw $2.2 billion in outflows from US equity ETFs, bringing total Q1 outflows to $4.5 billion, less than 10% of the record inflows experienced in Q4 2024. The downturn in US-focused flows coincided with growing concerns over concentration risk in US and global indices.

Commodities, particularly gold, contributed significantly to the quarter’s positive asset growth. Gold exchange-traded products experienced consistent positive flows over the past four months after largely being bypassed during much of the earlier gold price rally.

Gold delivered a 19% return in Q1, outperforming other major asset classes as investors sought traditional safe-haven assets amid an increasingly uncertain economic outlook and rising equity market volatility.

The insights from Q1 inflows come against tariff-induced volatility that emerged in April. Gary Buxton, Head of EMEA ETFs at Invesco, emphasized that the first quarter positioning indicates underlying investor sentiment.

He noted that European equities retain valuation support, while the increasing unease over concentration risks in US and global benchmarks could further sustain the pivot towards European markets.

Buxton also highlighted that ongoing economic uncertainty may continue to bolster gold’s appeal. The asset’s historically low correlation with equities and tendency to perform during periods of heightened risk aversion illustrate its role as a diversification tool.

Bitcoin is also reaffirming its position away from a risk asset toward a more technically aligned risk-off investment.

As market conditions are in flux, the inflows into European equities and gold observed in Q1 may inform future investor strategies, particularly in uncertain environments and a search for regional and asset diversification.