Will Europeans ever exchange euros for digital euros? To decide, the European Central Bank (ECB) has launched a public consultation. The idea of a digital currency issued by the Central Bank gained momentum with the pandemic and the development of dematerialized payments. The “digital” euro would be an electronic form of central bank money, existing alongside cash. Individuals and businesses could hold these cryptocurrencies in a “digital wallet”. It is expected that they will be able to deposit this currency directly with the central bank, access to which has so far been restricted to commercial banks. “It would allow everyone to make daily payments quickly, easily and securely,” the ECB said in a recent report. Its promoters claim that transactions would be much faster, even instantaneous, because they do not require interbank settlement and therefore available 24/7. Its mechanism could be based on blockchain technology (blockchain, a computer protocol known to be tamper-proof), on which virtual currencies such as bitcoin are already based, but without the volatility of cryptocurrencies.
The consultation aims to understand the expectations of the general public, the financial sector and institutions, and will last three months. Subsequently, “tests” will be carried out for six months. The ECB will therefore decide, around mid-2021. But technically it could take between 18 months and up to 3 or 4 years to see the initiative materialize.
The digital euro, a project enhanced by pandemic
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