Stablecoin fungibility war

There's a war going on between the ECB and the Commission over fungiblity.

At an EU parliamentary hearing last Monday, MEP-rapporteur Fernando Navarrete [largely perceived to be anti-digital euro plant] pressed Lagarde on the contradiction between her ambition for a “future euro reserve currency” and her alarm over USD-stablecoin inflows. Lagarde failed to answer convincingly, conceding the euro is “not there yet” while simultaneously warning that higher-yield offshore dollar tokens could lure savings away from EU banks.

But why is Lagarde so worried if the euro has such potential?

At first sight, Lagarde's comments make no sense. The Senate’s newly passed GENIUS ACT explicitly bars issuers from paying holders any interest or “yield” in-token.

The fact that Lagarde thinks otherwise is thus befuddling. At first, CashEQ heard it might be because she believes the GENIUS Act could still be changed, as it's still to be reconciled. Then we heard from sources familiar that she believes there may be workarounds.