European Central Bank embraces digital euro
Fabio Panetta of the ECB claims the proposed legislation on the region's digital euro would be beneficial to European citizens while keeping the monetary policy on a tight leash to avoid instability.
Fabio Panetta of the ECB claims the proposed legislation on the region's digital euro would be beneficial to European citizens while keeping the monetary policy on a tight leash to avoid instability.
Bank of Spain Deputy Governor Margarita Delgado and EU authorities will spearhead the retail side of digital euro through private payment service providers with possible offerings outside eurozone.
Under Banque de France Governor François Villeroy de Galhau's proposal, CBDC, tokenized bank deposits, and other digital currencies may be exchanged for value under one network.
The European Commission’s bill underpins the right of every resident in the eurozone to pay for free with the digital euro while protecting user privacy and security.
The European Central Bank intends to achieve financial inclusion through several initiatives, including providing physical digital euro payment cards, in-person support, and defunding through cash.
Slovak legislators worry that the digital euro will start out as an alternative but will soon be mandatory, and they fear Slovakia could lose monetary sovereignty.
While the digital euro will boost financial inclusion, it has the risk of bank disintermediation; regulators say as they called for friendly Bitcoin policies.
Commissioned by the ECB, the study also found that users want offline payments and programmability, with the underbanked most needing P2P payments.
The digital euro will be distributed to residents and merchants in the Euro Area first, but European Central Bank admits that all the authority lies with the European Parliament.
The digital euro is a solution in search of a problem, according to the report, noting that the central bank digital currency would have disruptive effects the European Central Bank isn’t ready for.
A successful application of a digital euro hinges on three levels: issuance, convertibility, AML mandates, and policies; interation on SEBA regions; and encourages private sector innovation.
The governor of Danmarks Nationalbank says that a dip in cash usage recently doesn’t signal a loss in trust in central bank money, nor the need for a CBDC.