A European Central Bank (ECB) official emphasized the need for a digital euro after US President Donald Trump’s executive order on dollar-backed stablecoins.

Trump’s directive aims to promote “lawful and legitimate dollar-backed stablecoins globally,” which could draw customers away from traditional banks.

ECB board member Piero Cipollone warned this could lead to lower fees and potential client losses, strengthening the case for a digital euro.

The proposed digital euro would be an ECB-backed online wallet, potentially managed by private entities like banks, allowing payments without traditional bank accounts and limits on holdings.

While the ECB is exploring the digital euro, it still need legislative approval from European lawmakers before launching.

Digital currencies are gaining traction globally, with countries like Nigeria, Jamaica, and the Bahamas already launching their versions.