While various stakeholders in the European Union continue to seek the potential of a single digital currency from the Central Bank (CBDC), representatives of private and public banking institutions share their opinion on the digital euro.
In a new issue of the Biannu Views magazine published in April, the subject of the digital euro has received great attention from a certain number of speakers.
Evelien Witlox, the director of the European Central Bank’s digital Euro program (ECB), has three priority use cases by the ECB. These are person’s payments made between individuals; Consumption payments to business, including electronic commerce and purchases made in a physical store; and payments to or by government.
Using cases are an area sensitive to private bankers. Like Jerome Grivet, the assistant CEO of French Bank Crédit Agricole, said:
“The digital money from the central bank could threaten the business model of traditional banks by competing with their recovery activity and disturbing their financing capacity.”
Grivet insists that to avoid this, the digital euro should be limited to use as a payment method rather than a reserve of value. This is something that Burkhard Balz, a member of the board of directors of Deutsche Bundesbank, agrees with. Balz underlines that the ECB and the national central banks should avoid extending their imprint too much in the ecosystem, the private sector performing the distribution of the digital euro. Economic incentives, according to Balz, are essential to involve intermediaries:
“They should therefore not consider the provision of digital services in euros as a kind of obligation, but should explore economic potential by developing and competition for creative solutions.”
Another side of the project that should be taken into account in using the CBDC is customers. It is difficult to predict how customers will react to this new form of money from the Central Bank and to what extent the general public will adopt it, says Grivet, citing an not so successive example of the Chinese digital yuan. The ECB’s Witlox is aware of this concern and promises that the CBDC will be user -friendly and will undertake on board those who cannot afford a credit card or who do not have a bank account:
“In accordance with its good public nature, a digital euro would also be essentially free.”
As for the potential anonymity problems, Witlox says that the ECB has no interest in personal user data and envisages solutions to preserve default and default confidentiality.
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The magazine also contains several interviews with American and Asian officials on the perspectives of cryptographic regulation in general.
For example, Kristin Johnson, Commissioner of the Commodity Futures Trading Commission of the United States, notes that the digital economy must be adjusted to the same regulatory standards as in traditional finance, which it believes effective. Johnson also repeats the variation in the motto “Blockchain, not crypto”, doubting “the extent of the relationship” of all the potential advantages of the technology of the great distributed book and private cryptocurrencies.
Tomoko Amaya, Vice-Minister of International Affairs at the Financial Services Agency of Japan (FSA), talks about the vulnerabilities of “self-proclaimed stables”, non-decaling liquidity and maturity, excessive leverage, improper use of customer assets and conflicts of interest. Amaya gives the example of the strict regulations of his country as a success, stressing the importance of a tight international framework.
On April 24, the ECB published its third stage report on the design of the digital euro. It offers integration by payment service providers, contactless sales and online and cross -border features. Published several days earlier, an analytical document from the European Parliament Committee on Economic and Monetary Affairs gave the digital euro a mixed examination, warning the possible disruptive effects of the project.
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