Brainport Rising — Special (2): Deep Tech Sovereign Fund

Why Europe’s Chip Stack Needs Ownership to Scale

Europe is building the technology. But it may not own it. For decades, the continent perfected a quiet export model. Not of products — but of potential. Universities, research institutes and public funding created breakthroughs that others would later scale, monetize and control. It is, perhaps, the most expensive form of generosity in the global economy. And it is still happening.

The headlines tell a different story.

Funding rounds are growing. Deep tech is gaining momentum. Companies like Axelera AI are raising hundreds of millions — in early 2026 alone, a $250 million round signaled that Europe can compete.

But look closer at the cap table. Global capital is present. Often dominant. And increasingly decisive. This is not a failure of innovation. It is a question of ownership.

From Innovation to Control

Europe has solved the early-stage problem.

• grants
• seed capital
• university spin-offs

But the real shift happens later. Scaling. That is where control is determined.

While Europe funds the beginning, others fund the outcome. Europe finances innovation. Others finance power. And that distinction matters more than ever.

Read More

Who Controls the Transaction?

Europe’s digital euro and the politics of payment infrastructure

Money is no longer the system

A payment is often seen as the simplest act in an economy: a transfer of value from one party to another. But in a digital society, that transfer no longer happens in isolation. It is processed, validated, routed and recorded by an underlying system — a system that is increasingly global, privately governed and technologically complex.

In that context, money itself is no longer the defining element of economic sovereignty.

Infrastructure is.

In a recent speech, ECB Executive Board member Piero Cipollone framed the digital euro not as a technological upgrade, but as a strategic necessity. Europe, he argued, must reduce its dependence on non-European payment systems to ensure resilience and autonomy in an increasingly fragmented world.

The argument is clear. The reaction is not.

While institutions describe the digital euro as a safeguard of sovereignty, parts of the public perceive it as a mechanism of control. Between those positions lies a deeper structural shift — one that goes beyond currency and into the architecture of economic participation itself.

The invisible dependency: Europe’s payment paradox

Europe issues one of the world’s most important currencies. Yet the infrastructure that processes everyday euro transactions is, to a significant extent, not European.

Two-thirds of card payments in the euro area rely on international schemes. Online transactions are increasingly routed through global technology platforms. Fees, standards and data practices are often set outside European jurisdiction.

This creates a structural paradox: Europe is monetarily sovereign, but infrastructurally dependent.

The risks are not theoretical. Dependence on external infrastructure introduces three systemic vulnerabilities:

• Disconnection risk — access to payment systems can, in principle, be restricted or withdrawn
• Extraterritorial reach — foreign legal frameworks can shape domestic transactions
• Market power concentration — pricing and rules are dictated by dominant global actors

The comparison with energy dependency is not incidental. Europe has already experienced how reliance on external infrastructure can evolve from efficiency into vulnerability.

Payments are now following the same trajectory.

From money to rails: the real system shift

The debate around the digital euro is often framed as a transition from cash to digital money. But this framing understates the scale of the transformation.

The real shift is not:

• physical → digital

It is:

• money → infrastructure

In a digital environment, value does not move freely. It moves through rails — systems that determine:

• who can transact
• under what conditions
• at what cost
• and with which data exposure

This introduces a new layer of power.

Where cash transactions are direct and autonomous, digital transactions are:

• mediated
• conditional
• and potentially programmable

This does not imply that the digital euro will be used for control. The ECB explicitly emphasises privacy, offline functionality and limits to oversight.

But structurally, the nature of money changes when it becomes embedded in infrastructure.

The question is no longer what money is. The question is who controls the system through which it flows.

The trust gap: sovereignty vs. control

If the institutional narrative is about autonomy, the public reaction reveals a different dimension: trust.

Responses to the digital euro frequently invoke themes such as:

• loss of financial freedom
• surveillance and traceability
• potential exclusion from the system

These concerns are often dismissed as exaggerated. But they point to a real issue: Infrastructure centralisation requires institutional trust — and that trust is uneven.

The ECB’s position is that a European, publicly anchored system is inherently more trustworthy than reliance on foreign private actors.

A growing part of the public, however, questions whether any centralised digital system — regardless of jurisdiction — can guarantee neutrality over time.

This creates a governance tension:

• Strategic logic → centralise infrastructure to reduce external dependency
• Societal perception → centralisation increases internal control risk

Both positions are internally consistent. And both can be true at the same time.

The geopolitical layer: payments as strategic infrastructure

The digital euro cannot be understood in isolation. It is part of a broader shift in how infrastructure is viewed across domains:

• Energy → from efficiency to security
• Semiconductors → from supply chains to sovereignty
• Telecom networks → from connectivity to control
• Finance → from markets to infrastructure

Payments now sit firmly within this logic.

Control over payment systems implies control over:

• economic participation
• transaction data
• financial flows
• and, in extreme cases, access to the economy itself

In that sense, payment infrastructure is not merely a financial utility.

It is a sovereign capability.

The digital euro is Europe’s attempt to ensure that this capability remains within its own institutional framework — rather than being outsourced to global private or foreign actors.

The deeper question: access to the system

Beneath the debate over CBDCs, privacy and fees lies a more fundamental issue: Who has the authority to grant or deny access to economic life?

In a cash-based system, access is largely unconditional. In a fully digital system, access is mediated by infrastructure — and therefore by governance.

This does not automatically lead to exclusion or control. But it does mean that:

• access becomes design-dependent
• participation becomes system-dependent
• and autonomy becomes infrastructure-dependent

This is the core transformation.

And it extends far beyond the digital euro.

Conclusion — The infrastructure defines the system

The debate around the digital euro is often framed in binary terms: innovation versus risk, sovereignty versus control, public versus private. But the underlying reality is more complex.

Europe is attempting to solve a real structural problem: its dependence on external payment infrastructure in a digital economy. The proposed solution — a sovereign digital payment system — is consistent with that objective.

At the same time, the shift toward infrastructure-based money introduces new questions about governance, trust and control that cannot be resolved through technical design alone.

In a digital economy, money is no longer the system. The infrastructure that processes it is.

And as that infrastructure becomes more central, more integrated and more powerful, the defining question for Europe will not be whether it controls its currency.

It will be whether it can build a system that is not only sovereign — but also trusted by those who depend on it.

---

Photo by Mathieu Stern / Unsplash

Who Decides Where Capital Flows in Europe?

Rethinking capital allocation as the infrastructure of Europe’s future

The Invisible System

Capital is often described as a resource — something that can be invested, mobilised or deployed. But this framing obscures a more fundamental reality. Capital is not neutral.

It determines which technologies scale, which companies survive and which infrastructures are built. It shapes the boundaries of what becomes economically possible.

And yet, the system that governs its allocation remains largely invisible.

A European Paradox

Europe is not short of capital.

It has deep savings pools, large institutional investors and one of the most stable financial systems in the world. Pension funds alone represent vast reserves of long-term capital.

At the same time, Europe struggles to finance its own future.

Deep tech companies often face a funding gap when moving from research to industrial scale. Strategic infrastructure projects depend heavily on public funding. And many high-growth firms ultimately seek capital outside Europe.

This raises a fundamental question: How can a capital-rich continent struggle to fund its own transformation?

How Capital Actually Flows

To understand this paradox, one must look at how capital flows in practice.

A significant share of European capital moves through traditional banking systems, such as ABN AMRO. These institutions operate on a logic shaped by stability, risk management and collateral.

This logic is highly effective for financing tangible assets — real estate, industrial facilities, established businesses.

But it struggles with:

• intangible assets (intellectual property, data, algorithms)
• uncertain growth trajectories
• technologies that require scale before profitability

As a result, capital allocation remains anchored in the existing economic structure. It preserves what already exists, rather than enabling what could emerge.

Different Logics of Capital

This becomes clearer when compared internationally.

United States

In the United States, venture capital and deep capital markets dominate. Risk is embraced as a pathway to scale.

Capital flows toward:

• growth potential
• network effects
• technological dominance

The underlying logic is expansion.

Asia

In parts of Asia, capital allocation is more coordinated. States play an active role in directing investment toward strategic sectors such as semiconductors, energy and infrastructure.

The underlying logic is positioning.

Europe

Europe occupies an intermediate position.

Its system combines:

• bank-based financing
• fragmented capital markets
• regulatory complexity

The result is a system optimised for stability — but less effective at directing capital toward emerging technological domains.

The Structural Gap

The issue is not a lack of capital. It is a lack of alignment.

Europe produces world-class research in areas such as photonics, semiconductors and quantum technologies. Yet when companies in these fields require €100 million or more to scale — to build facilities, to industrialise production — funding often becomes scarce.

The consequence is familiar:

• companies list abroad
• technologies are acquired
• value creation shifts elsewhere

Europe effectively funds early-stage innovation, but struggles to capture its long-term returns.

Europe does not lack capital — it lacks a coherent logic of allocation.

A Changing Financial Landscape

At the same time, a new layer of capital infrastructure is emerging.

Digital financial platforms and crypto-based systems are beginning to reshape how capital moves globally. The establishment of entities such as Coinbase Ireland Ltd. reflects this shift.

Capital flows increasingly toward:

• regulatory clarity
• operational flexibility
• scalable digital infrastructure

This introduces a new dynamic.

While Europe continues to debate integration through initiatives such as the Capital Markets Union, parts of its future financial infrastructure are being built — and controlled — by actors operating beyond traditional European systems.

Capital as Infrastructure

To understand what is at stake, capital must be reframed. It is not merely a financial sector. It is infrastructure.

Like energy networks or telecommunications systems, capital allocation determines whether resources reach their destination. Without the appropriate channels, even abundant capital cannot support growth.

The comparison is instructive:

• energy requires grids
• data requires networks
• capital requires allocation systems

If these systems are fragmented or misaligned, flows are constrained. The result is not a lack of resources — but a failure of transmission.

What Is Missing

The question, then, is not whether Europe should regulate financial markets more effectively.

It is whether it has a shared framework for directing capital toward its long-term ambitions.

Such a framework would need to address:

• coordination between public and private capital
• alignment between risk and societal goals
• mechanisms for scaling strategic technologies

At present, these elements remain only partially connected.

Implications for Europe

This has consequences beyond finance.

Capital allocation influences:

• technological sovereignty
• industrial capacity
• geopolitical positioning

A system that cannot direct capital effectively risks losing control over its own development trajectory.

A System Yet to Be Defined

Europe has taken significant steps in shaping the rules of its markets. But the deeper question remains unresolved: Who decides where capital flows — and on what basis?

Until this question is addressed, Europe’s economic future will remain shaped not only by its ambitions, but by the underlying systems that enable — or constrain — them.

This article is the first in the series Capital as Infrastructure: Rethinking Europe’s Financial System, which explores how capital allocation functions as a foundational system shaping Europe’s economic future.

---

Image credit:
AI-generated illustration, conceptualised by Altair Media Europe

Caption:
A reflective perspective on Europe’s financial system — where capital flows, institutional structures and emerging technologies intersect to shape what can scale, and what remains potential.

The Bank Without Bankers

Algorithms, regulation and shareholder pressure are reshaping Europe’s financial system

On a grey weekday morning in Amsterdam’s financial district, the glass towers of the Zuidas reflect the muted light of the North Sea sky. Inside one of those towers, millions of financial transactions pass through servers every hour. Algorithms analyse patterns, flag irregularities and calculate risk scores in fractions of a second.

Somewhere within those data flows, an automated system may decide that a small entrepreneur poses too high a risk for credit. Another model may classify a customer’s transaction as suspicious and freeze an account. In most cases, no human being will have examined the decision beforehand.

Modern banking has become a system of data.

Across Europe, banks are rapidly transforming into digital infrastructures built on automated decision-making. Artificial intelligence monitors payments, determines creditworthiness and identifies potential fraud. Compliance systems analyse vast datasets in order to satisfy regulators. Meanwhile, investors demand ever higher levels of efficiency.

In this environment, the traditional banker — the professional exercising judgement based on experience and personal knowledge of customers — is gradually disappearing.

“Many banks still need to adapt their risk management to the specific challenges posed by artificial intelligence, including explainability and clear accountability for AI-driven decisions.”

Elizabeth McCaul
Member of the Supervisory Board
European Central Bank

Her warning reflects a growing concern in European financial circles. Technology is reshaping banking faster than governance structures can adapt.

What emerges from this transformation is something new: a bank without bankers.

Read More

Power Without Control

Who Governs When No One Is in Charge?

The Paradox of Organized Power

The defining paradox of the early 21st century is not a collapse of power, but its diffusion. Our world is more organized, monitored and optimized than at any point in history. Financial markets operate around the clock, global supply chains synchronize production across continents, algorithms allocate capital and information in milliseconds and infrastructures hum with quiet reliability. Yet when disruptions occur — a market shock, a supply crisis, a cascading outage — responsibility becomes strangely difficult to locate. The system functioned, until it didn’t. No single actor appears to have commanded the outcome, yet the outcome shapes everyone.

Power has not disappeared; it has changed form. In the industrial age, power flowed from ownership, territory and hierarchy. Governments commanded armies, regulated industries and controlled borders. Authority was visible and institutionalized. Today, influence increasingly resides in the systems that coordinate activity rather than in the actors who nominally control them.

From Command to Infrastructure

Protocols, platforms, standards and data flows have become the operational layer of modern society — the plumbing through which decisions, transactions and signals travel. In such a world, influence depends less on issuing orders than on operating the nodes through which others must pass.

“We are moving from a world of ‘nations’ to a world of ‘networks’. Infrastructure is not just logistics; it is the new geography of power. If you control the nodes, you don’t need to control the borders.” — Parag Khanna, strategic advisor and author of Connectography

Payment systems determine which transactions clear. Cloud platforms determine where digital life resides. Risk models shape how trillions in capital are deployed. Logistics networks determine which goods arrive and which do not. These infrastructures rarely command behavior directly, yet they structure the field of possibility within which decisions occur. Power becomes environmental rather than coercive.

Indispensability as Authority

This shift produces a new form of influence based on indispensability. Actors that operate critical systems need not exercise overt authority to shape outcomes; their centrality does the work for them. A cloud provider does not dictate policy, yet governments depend on its uptime. A financial infrastructure does not command investment decisions, yet markets coordinate around its signals. Control is replaced by dependency. Sovereignty becomes entangled with operational reliance.

“The modern state has become a contractor of its own sovereignty. We see governments that retain the responsibility for public welfare, but lack the technical tools to execute it without private platforms.” — Rana Foroohar, Associate Editor at the Financial Times and author of Homecoming

The result is what might be called an exo-skeleton state: public authority wrapped around privately operated capabilities. Governments still legislate, tax and represent democratic legitimacy, but their effectiveness increasingly depends on infrastructures they neither fully own nor fully understand.

Europe’s Structural Asymmetry

Europe illustrates this transformation with particular clarity. The continent possesses vast savings, advanced regulatory capacity and strong public institutions, yet often relies on external platforms for cloud computing, digital ecosystems, defense technologies and capital allocation mechanisms. It writes many of the rules governing global markets, but operates relatively few of the infrastructures through which those markets function.

“Europe is a regulatory superpower, but an industrial bystander. We are excellent at writing the rules for a game that is being played on stadiums built and owned by others.” — Mario Draghi, former President of the European Central Bank and former Prime Minister of Italy

Traditional sovereignty rested on territory, currency and institutional authority. Contemporary sovereignty increasingly depends on diagnostic capability — the ability to see, model and respond to systemic risks in real time. Here private platforms often possess a decisive advantage. While governments analyze retrospective statistics, platform operators observe behavioral patterns as they unfold.

Insight, Speed and Silent Drift

Access to real-time data creates an asymmetry of perception. Those who see the system live can shape responses before others even recognize the problem. Governance becomes less about issuing rules and more about interpreting signals.

Failures in such environments rarely appear as sudden collapses. More often they manifest as gradual drift: biases accumulating in algorithms, vulnerabilities propagating through supply chains, correlations building quietly across markets. Because no single actor oversees the whole, emerging fragilities remain distributed and partially invisible until they crystallize into crisis.

“The danger is not that machines will begin to think like men, but that men will begin to think like machines. When systems take over decision-making, responsibility evaporates into the code.” — Henry Kissinger, former U.S. Secretary of State

The Accountability Gap

Modern political institutions were designed to oversee rulers, not infrastructures. Parliaments can question ministers, courts can review executive decisions and voters can replace governments. But who answers for outcomes produced by complex interactions among algorithms, markets and networks? When harm emerges from coordination rather than command, responsibility disperses across the system.

This diffusion creates an accountability gap at the heart of contemporary governance. Influence is real, consequences are tangible, yet no single actor can be said to have willed the outcome. Power becomes both pervasive and elusive.

From Control to Stewardship

The instinctive response is to seek renewed control — to regulate more tightly, centralize authority or dismantle dominant systems. Yet complex adaptive infrastructures resist direct command. They are too interconnected to govern hierarchically and too essential to abandon.

The alternative is stewardship: governance focused on resilience, transparency and systemic stability rather than total authority. This requires a different kind of public capacity — less oriented toward issuing orders, more toward understanding interdependencies, managing risks and maintaining functional continuity. The public servant of the infrastructure age may resemble an engineer of systems more than a commander of institutions.

The Quiet Question

Power has not become weaker. It has become infrastructural, distributed.and partially anonymous. It resides in operating systems rather than command centers, in protocols rather than proclamations, in dependencies rather than decrees. We have constructed a civilization whose stability depends on systems that no one fully controls yet everyone relies upon.

If authority no longer resides primarily in rulers but in the infrastructures that shape collective behavior, a deeper political question emerges — one that neither markets nor traditional institutions can easily answer:

Who governs when no one is in charge?

Photo credit:
AI-generated illustration for the Power Without Control: Sovereignty in the Infrastructure Age series.

---

This article is part of the Power Without Control series, exploring how infrastructure, platforms and systemic dependencies are reshaping sovereignty and governance in the 21st century. Read the full dossier here → Power Without Control