The Bank of Italy has raised alarms about the systemic risks posed by the growing ties between cryptocurrencies and traditional financial systems, particularly in the context of the Trump administration's supportive stance towards digital assets. In its latest Financial Stability Report, the central bank identified potential vulnerabilities stemming from increased integration of crypto markets, emphasizing that close connections could lead to greater instability for financial intermediaries. The bank noted a considerable rise in digital asset values following the U.S. election of Donald Trump, indicating concerns over Bitcoin's significant market share. The report also highlighted the risks associated with dollar-backed stablecoins, warning that massive redemption runs could disrupt global markets. Despite the central bank's cautious approach, some Italian banks, like Intesa Sanpaolo, are actively engaging in crypto investments, suggesting a mixed sentiment within the financial sector towards digital currencies.

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