In Europe, the European Commission is drafting a new directive to regulate issuers and service providers of crypto-assets, while the European Central Bank is currently considering the possibility of starting a formal investigation phase on a digital euro.
But let us also not forget that profitability is weak in many European banking systems for deeper structural reasons that predate the crisis and current monetary policy settings. Europe remains overbanked, insufficient progress has been made on the overhang of non-performing loans since the crisis and there is increasing competition from FinTech companies and non-banks.