European Central Bank (ECB) President Christine Lagarde has voiced strong opposition to the promotion of euro-denominated stablecoins, citing significant risks to financial stability and monetary policy. Speaking at the Banco de España Latam Economic Forum, Lagarde highlighted the potential dangers, referencing the depegging of USDC during the 2023 collapse of Silicon Valley Bank, which exposed $3.3 billion in Circle reserves. Lagarde emphasized that the current stablecoin market is overwhelmingly dollar-dominated, with Tether and Circle controlling a large share. She warned that euro stablecoins could disrupt the ECB's monetary policy transmission by narrowing the rate channel if retail deposits shift to non-bank stablecoins. Instead, Lagarde pointed to the ECB's Pontes project, set to launch in September 2026, which aims to integrate distributed ledger technology with central bank money, as a preferred alternative to private stablecoins.