Trump’s Pro-Crypto Policy Raises Concerns Over Global Financial Stability, ECB Official Warns

A senior European Central Bank official has expressed apprehension about the Trump administration’s strong support for cryptocurrency, suggesting it could set the stage for significant financial disruptions on a global scale.

François Villeroy de Galhau, who serves as the Governor of the Bank of France and sits on the ECB’s Governing Council, shared his views in a recent interview with the French publication La Tribune Dimanche. He cautioned that the United States, by promoting Bitcoin and cryptocurrencies, might be overlooking potential risks that could ripple across the world economy. Villeroy de Galhau pointed out that financial crises frequently begin in the U.S. before affecting other regions, a pattern he fears could repeat itself under current policies.

The official’s concerns come amid a broader push by President Donald Trump to position the United States as a leader in the cryptocurrency and digital asset space. Since taking office, the Trump administration has moved quickly to advance its pro-crypto agenda, rolling out initiatives like a dedicated crypto council and a Presidential Working Group focused on digital assets. The administration has also worked to pass key legislation supporting the industry, signed an executive order to create a Strategic Bitcoin Reserve, and hosted a first-of-its-kind crypto summit at the White House. Additionally, Trump has pledged to roll back banking regulations from the Biden era that restricted cryptocurrency operations, actions that have elevated the industry’s visibility and influence.

Europe’s Response and the Broader Context

Villeroy de Galhau’s remarks build on earlier warnings from economic experts, including sixteen Nobel Prize-winning economists who last June highlighted the potential for Trump’s fiscal policies to destabilize markets and fuel inflation. He described the administration’s approach as rooted in a flawed belief that the global economy operates as a zero-sum game, where one nation’s gain comes at another’s expense.

In response, he urged Europe to bolster its stance in negotiations with the U.S. to safeguard its economic interests. This call aligns with the ECB’s own efforts to adapt to the rise of digital finance. Earlier this year, the bank outlined a two-phase plan to develop a digital payments infrastructure, aiming to create a streamlined system for settling transactions in central bank money on a blockchain. This initiative could eventually pave the way for a central bank digital currency, offering a regulated alternative to decentralized cryptocurrencies. Just last week, the head of the European Stability Mechanism (ESM), Pierre Gramegna, cautioned that Trump’s aggressive promotion of dollar-backed stablecoins could threaten the European Union’s monetary sovereignty.

Despite the Trump administration’s efforts, the crypto market has not experienced the stability some might have expected. Bitcoin prices, along with U.S. stock indexes, have faced turbulence tied to broader economic policies. Last week, Trump’s threat to slap 200% tariffs on European spirits triggered a sharp decline in the S&P 500, which dropped over 10% from its February peak, according to Reuters.

This volatility underscores the challenges faced so far while trying to integrate crypto into a traditional financial framework, especially as global markets remain interconnected. Villeroy de Galhau’s critique suggests that while the U.S. pursues its crypto ambitions, the potential for unintended consequences looms, particularly if regulatory oversight fails to keep pace with innovation.