ECB Progresses Digital Euro Decision Amid Rising Debate
(16 February 2022 – Europe) A decision on a digital Euro will be made by 2024 as the European Central Bank (ECB) launched its investigation phase of the digital euro project in response to growing interest in digital assets and the potential for technology to drive innovation in the payments and transfers sector.
The ECB joins most central banks around the world investigating the potential for central bank digital currencies (CBDC). From a contrarian view, Facebook’s (Meta) thwarted attempt to create a non-sovereign global currency has stoked up the debate between major stakeholders. Much of the debate centres on the purported benefits of a CBDC such as improved access for the underbanked, real-time payments, and reduced costs of transfers however questions remain as to the impact of a CBDC on monetary policy.
“We will investigate how a digital euro could offer a convenient, cost-free means of payment, allowing people to pay anywhere in the euro area with risk-free digital money for example, when making payments online, which preclude the use of cash” ECB President Christine Lagarde stated in a speech to the European Parliament.
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