The Future of Payments in Europe: The Digital Euro, Stablecoins and Monetary Sovereignty

This study examines the fundamental transformation of the monetary landscape within the Eurozone, focusing on the emergence of the Digital Euro and its relationship with Stablecoins. In an era where the use of physical cash is rapidly declining, the European Central Bank is called upon to provide a digital alternative to public money that ensures both privacy and financial stability. The article analyzes the UTXO (Unspent Transaction Output) technological architecture, which enables the Digital Euro to function "like cash" even in offline environments, distinguishing it from traditional banking systems and private Stablecoins governed by the MiCA regulation. Furthermore, the study examines the 2023 legislative framework and control mechanisms, such as the "Waterfall" function, designed to prevent the disintermediation of the banking sector. Finally, the paper highlights the geopolitical dimension of this initiative, arguing that the Digital Euro serves as a strategic "digital anchor" for reclaiming Europe’s monetary sovereignty. By reducing dependency on foreign private payment infrastructures, Europe aims to transform itself from a regulator into a pioneer of the global digital economy, returning control over assets and data to the hands of its citizens. This paper adopts a conceptual and institutional approach, drawing primarily on official publications from European institutions. It aims to contribute to the academic discussion by synthesizing existing policy, technological, and regulatory developments rather than by presenting original empirical findings.