After months of deliberation, the European Central Bank has decided to proceed with a digital euro project. Officials insist the new version of Europe’s common currency should “ensure privacy” and provide access to “the safest form of money” at a “negligible” cost to the environment, in comparison with bitcoin.
Eurosystem Initiates Digital Euro Project
The Governing Council of the European Central Bank (ECB) took a long-awaited decision on Wednesday to launch the ‘investigation phase’ of a project to issue a central bank digital currency (CBDC). The stage will continue for two years during which key aspects of the design of the digital euro and questions regarding its distribution will be addressed. In any case, it will not replace cash and a final decision on its issuance is yet to come.
“It has been nine months since we published our report on a digital euro. In that time, we have carried out further analysis, sought input from citizens and professionals, and conducted some experiments, with encouraging results. All of this has led us to decide to move up a gear and start the digital euro project,” ECB President Christine Lagarde said after the meeting. She also emphasized:
Our work aims to ensure that in the digital age citizens and firms continue to have access to the safest form of money, central bank money.
The Eurosystem, consisting of the ECB and the national central banks of the Eurozone’s 19 member states, intends to take into account the needs of future users when outlining the functional design of the digital euro. The investigation phase will involve focus groups, prototyping and conceptual work to examine the use cases for the currency, the regulator said in a press release.
The ECB will work with the European Parliament and the European Commission to establish what changes to the Union’s legislative framework would be needed to introduce the CBDC. The bank…