Friedrich Merz Leads Chancellor Race — Germany’s Approach to Crypto and Financial Innovation To Evolve

Key Takeaways

• Friedrich Merz, leader of the CDU, is the frontrunner in Germany’s federal election.
• Alice Weidel’s AfD trails behind but has a more aggressive pro-crypto stance.
• A Merz-led government could reshape Germany’s financial sector with pro-business and innovation-focused policies.

Germany’s upcoming federal election is shaping up to be a pivotal moment for the country’s economic future, with Friedrich Merz emerging as the frontrunner to become the next chancellor.

As leader of the center-right Christian Democratic Union (CDU), Merz has built his platform on pro-business policies, financial reform, and innovation.

While he has not positioned himself as an outspoken crypto advocate, his broader economic stance could have significant implications for the industry.

Standing against him is Alice Weidel, leader of the far-right Alternative for Germany (AfD). While trailing in the polls, Weidel has taken a much more aggressive pro-crypto stance, calling for deregulation and pushing for Germany’s exit from the euro.

With Germany playing a crucial role in shaping Europe’s financial policies, the election’s outcome could set the tone for the region’s approach to cryptocurrencies and financial innovation.

Merz’s Pro-Business Agenda Could Reshape Germany’s Financial Sector

Merz’s reputation as a pro-business politician is deeply rooted in his extensive financial background.

Before entering politics, he served as chairman of BlackRock Germany’s supervisory board and held senior positions at HSBC Trinkaus & Burkhardt. He also sat on the boards of Deutsche Börse, EY Germany, and Borussia Dortmund.

As Germany struggles with economic stagnation, Merz has positioned himself as the candidate capable of reversing the country’s downturn. His economic platform includes:

• Cutting corporate and income taxes to encourage investment.
• Reducing bureaucratic red tape to spur entrepreneurship.
• Strengthening Germany’s position in the European capital market union.
• Establishing a new ministerial position focused on artificial intelligence and digitization.
• Expanding venture capital opportunities to make Germany a global startup hub.

These policies align with a growing trend among global leaders, including U.S. President Donald Trump, who have positioned themselves as champions of innovation.

CDU’s Traditional Approach to Finance Faces a Potential Shift

The CDU has historically taken a cautious stance on financial and technological innovation, prioritizing stability and regulatory oversight over rapid change.

However, as digital assets and AI gain traction worldwide, Merz’s government may have to adapt to new financial realities.

The conservative bloc aims to position Germany as Europe’s financial powerhouse—an ambition that faces stiff competition from London and Paris.

This includes strengthening the European Capital Markets Union and establishing Germany as a leader in venture capital and startups through tax incentives.

Merz’s platform also focuses on combating financial crime, proposing the creation of a customs police force with expanded powers to target money laundering and other financial misconduct.

His administration would likely advocate for the introduction of a digital euro, but only if it provided clear benefits.

A recent central bank survey indicated that half of Germans would either “definitely” or “probably” use a digital euro, reflecting growing public interest in central bank digital currencies (CBDCs).

Weidel’s Radical Financial Vision

While Merz represents a more traditional pro-business approach, his opponent, Alice Weidel, has positioned herself as the more radical candidate on economic issues—particularly regarding crypto.

Endorsed by Elon Musk, Weidel has proposed sweeping financial changes, including Germany’s exit from the euro and full deregulation of Bitcoin. Her policies would strip away government oversight of the cryptocurrency market, allowing for a more autonomous financial system.

Though AfD is currently trailing in the race, Weidel’s strong pro-crypto stance has resonated with parts of the digital asset community. Her proposals, if enacted, would create one of the most crypto-friendly regulatory environments in the world.

What’s at Stake for Crypto and Finance in Germany?

Regardless of who wins, Germany’s approach to crypto and financial innovation is likely to evolve. Merz may not be as aggressively pro-crypto as Weidel, but his commitment to fostering a business-friendly environment could indirectly benefit the industry.

His emphasis on cutting bureaucracy and encouraging private investment could create a more favorable regulatory climate for blockchain and fintech startups. However, his support for a digital euro—albeit with conditions—suggests that he will maintain a measured, regulatory-first approach to digital assets.

As Europe’s largest economy, Germany’s stance on financial innovation will influence the broader European Union. A Merz-led government would likely seek to balance innovation with regulation, ensuring that Germany remains competitive while maintaining financial oversight.

Meanwhile, Weidel represents a more radical departure, advocating for sweeping financial reforms that could dramatically reshape Germany’s economic landscape.

The election’s outcome will determine whether Germany takes a cautious, business-driven approach under Merz or embraces more aggressive financial reforms under Weidel. Either way, the country’s economic and innovation policies are poised for change.