Europe's Dollar Dilemma: A Threat to Payment Sovereignty
Europe's payment sovereignty problem is not about plastic cards, but rather about currency power and financial infrastructures that govern global money flows. The real exposure lies in the dominance of the US dollar and the extraterritorial reach of US law over global financial markets.
European banks are deeply embedded in dollar-denominated markets, including trade finance, energy markets, capital markets, correspondent banking, and clearing. Despite the euro's 20% share of international currency use, a significant share of large cross-border transactions transit through the dollar system, subjecting European institutions to US sanctions regimes and anti-money laundering rules.
The choice for European banks is clear: comply with US sanctions or lose access to dollar clearing and global markets. Card schemes sit at the edge of this system, not at its core.