Cryptomercantilism vs Monetary Sovereignty: How Stablecoin Laws Shape the Battle for International Monetary Supremacy

Jens Van’t Klooster, Edoardo Martino and Eric Monnet ()
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Jens Van’t Klooster: UvA - Universiteit van Amsterdam = University of Amsterdam
Edoardo Martino: UvA - Universiteit van Amsterdam = University of Amsterdam
Eric Monnet: PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - ENPC - École nationale des ponts et chaussées - IP Paris - Institut Polytechnique de Paris, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - ENPC - École nationale des ponts et chaussées - IP Paris - Institut Polytechnique de Paris

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Abstract: Stablecoins are privately issued cryptocurrencies whose value is pegged to official currencies such as the US dollar. Their ease of use on the global level opens up a new front in global currency competition. This article asks how the EU and US—the issuers of the world's two leading currencies—approach stablecoins through their respective legal frameworks. We contrast a US strategy of cryptomercantilism with an EU strategy of monetary sovereignty. These strategies yield legal frameworks that look similar on the surface but diverge sharply in substance. The US's GENIUS Act aims to enhance the dollar's dominance in global payment systems and stimulate new demand for US assets, particularly government bonds. The EU's Markets in Crypto-Assets Regulation (MiCAR) serves to safeguard the state's ability to govern money. We conclude by discussing how the euro area and other countries can react to US cryptomercantilism, highlighting new challenges related to regulatory equivalence agreements and fungibility of tokens issued in different jurisdictions.

Date: 2026
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Published in Journal of Financial Regulation and Compliance, In press, ⟨10.1093/jfr/fjag008⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:pseptp:halshs-05845324

DOI: 10.1093/jfr/fjag008

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