Fabio Panetta, current Governor of the Bank of Italy, maintained this Wednesday that commercial bank money will reach absolute digitalization very soon. According to the official, the market stability of stablecoins lacks its own autonomy by depending on traditional fiat currencies to function. This vision reinforces the central role of financial institutions against private technology in the ecosystem.
During his speech before the banking association committee, the senior official highlighted that payments represent a fundamental strategic ground today. When considering current technical evolution, Panetta noted that commercial and central banks must anchor the global monetary system effectively. Consequently, traditional financial infrastructure will adapt to lead digital exchange processes in a sovereign and controlled way.
When analyzing the economic landscape, the banker observed that financial variables are increasingly influenced by external political and non-market decisions. It is evident that the economic center of gravity moves toward innovative technological power globally. However, this transformation occurs in a fragmented international framework, where cooperation between nations seems to be increasingly limited and complex.
Banking digitalization as the axis of European monetary sovereignty
Although the private sector promotes digital tools, these will only play a secondary role according to the institutional perspective presented this week. In this regard, it was emphasized that the support of public money guarantees the necessary trust in the system. Thus, the aim is to prevent unregulated actors from affecting the market stability of stablecoins in the eurozone.
This is not the first time the entity warns about the operational dangers associated with digital assets of private origin. Previously, Vice Director Chiara Scotti stated that multi-issuance tokens generate considerable legal and financial risks for the Union. Therefore, it is imperative to establish strict reserve mandates that ensure the redemption of funds in any financial crisis circumstance.
What impact will strict regulation have on the digital payments ecosystem?
Likewise, the implementation of regulations like MiCAR seeks to mitigate the inherent volatility that crypto assets present in today’s world finance. Although stablecoins could significantly reduce transaction costs, state supervision remains a high priority for everyone. Consequently, Italian authorities advocate for restricting their issuance to jurisdictions that maintain regulatory standards equivalent to those of Europe.
Closing his speech, Panetta reiterated that institutional trust constitutes the fundamental pillar of any successful and modern currency project. Therefore, the future of digital money will remain under control of banks already established. Thus, it is expected that the market stability of stablecoins remains as a variable dependent on the backing offered by central banks and institutions.
