Europe’s future with digital currencies is up for debate. A group of European countries have firmly stated they want nothing to do with Facebook Libra, while a group of German banks are insisting the European Union (EU) needs some kind of digital currency to work with, which the EU doesn’t seem keen to agree with.
Five EU nations—Germany, Italy, Netherlands, Spain and led by France—are figuring out how they can keep Libra out of the continent, Politico Europe reports. Deputy finance ministers from each of the five countries have privately presented a case against the Libra in private October 28 meetings held in Brussels.
Not only are they hoping to shut out Mark Zuckerberg’s currency project, they want to encourage the Libra Association to just give up entirely. But first, to keep the Libra out of Europe, they will have to come up with a legal reason to do so, and determine rules that can help maintain the status quo.
Meanwhile in Germany, the Association of German Banks, which represents over 200 private financial institutions, have published a paper calling on the EU to adopt a programmable digital euro. They argue that monetary policy should remain in the realm of state’s responsibilities, and only with a digital euro can the union maintain all of the controls the current financial system enjoys. They explain:
The user of a digital euro – whether man or machine – must be clearly identifiable. This requires a European or, better still, a global identity standard. With every form of digital money, customers should be identified using a standard that is just as strict as that which banks and other obligated entities are required to apply under current legal framework pursuing the combat against money laundering and terrorist financing.
Also commenting on the Libra, the Association of German Banks notes that if it should come into Europe, it could add economic and political conflict to the mix.
The European Central Bank (ECB) seems happy to avoid digital assets entirely at this point. They’ve noted in the past that they don’t believe cryptocurrencies are money, or even a threat, to the current system. ECB President Mario Draghi wants to keep it that way, recently saying, “It will be ensured that stablecoins do not establish themselves as an alternative to state currencies and thus call into question the existing monetary system.”
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