Denis Beau breaks with Lagarde over stablecoins

Denis Beau urged immediate private-sector mobilisation to build euro stablecoins, breaking publicly with ECB president Christine Lagarde’s slower approach.

Denis Beau, deputy governor of the Banque de France, called on May 12 for a “mobilization of all relevant European players, public and private,” to develop euro-based tokenised money to counter the dominance of dollar-pegged stablecoins. His position puts him at odds with ECB president Christine Lagarde, who favours waiting for a state-issued digital euro scheduled for around 2029.

“To ensure a sound development of tokenised finance in Europe, its payment and settlement asset pillar should be in euro,” Beau told analysts this week. Dollar-pegged tokens from Tether and Circle currently account for 98% of the total stablecoin market, a concentration Beau described as a direct threat to European monetary sovereignty.

What Beau is asking for and why it differs from Lagarde

While Lagarde has consistently warned that privately issued stablecoins risk amplifying financial vulnerabilities, Beau argued that private-sector solutions are necessary for Europe’s economic development right now, without waiting for a retail CBDC. He specifically cited the risk of “digital dollarisation” at the settlement infrastructure level if euro-denominated alternatives fail to reach sufficient liquidity.

Beau’s stance aligns with Qivalis, a consortium of 12 major European banks, including BBVA, ING, UniCredit, and BNP Paribas, that are planning to launch a euro-pegged stablecoin in the second half of 2026. He also pointed to the Eurosystem’s Pontes project, which will deploy wholesale central bank money in tokenised form before the end of 2026.

“A first deliverable will become available by the end of this year, with the opening of our wholesale central bank money service in tokenized form,” Beau said, framing it as a foundation rather than a complete solution.

The internal ECB divide and what it means for Europe

The split between Beau and Lagarde reflects a broader strategic disagreement within European institutions. Lagarde has argued that dollar and euro-pegged stablecoins alike pose financial stability risks, while Beau and French Finance Minister Roland Lescure have both pushed for more aggressive private-sector development of euro stablecoins as a near-term countermeasure.

The German central bank has also signalled openness to euro-denominated stablecoins as a means of improving cross-border payment efficiency. The gap between the ECB’s retail CBDC timeline and the immediate commercial pressure from dollar stablecoins is giving central bankers across Europe more reason to support private alternatives rather than waiting for a state-led solution.