As a US citizen living in Europe, An EU passport would be quite useful. Having EU citizenship makes it MUCH easier to work in the EU. I will be applying for Cypriot citizenship once I have lived here in Cyprus for 8 years (only 6+ years to go).
I don't see why a person could not show allegiance to more than one country.
I have moved to Cyprus and will spend the rest of my life here. That is why I will be applying for Cypriot citizenship. Cyprus does not require that I give up my US citizenship, though I would if they required it because this is my home now.
BTW, it now costs $450 to renounce your US citizenship. I don't want to get into a patriotic vs unpatriotic discussion, but I do find it very strange that a country can force you to remain a citizen by charging a fee.