The European Central Bank has launched an internet consultation for a ‘digital euro’. The ECB wants to know what citizens and businesses think of that concept. It would then be a digital counterpart to cashless money, which is managed by a central authority.
In the consultation, the European Central Bank is calling for views on what it calls the Digital Euro. Among other things, the ECB wants to know what such a currency should look like, but also what that might mean for monetary policy and financial stability. Citizens can fill out a survey to answer questions about it.
The ECB has been working on a concept for a digital euro since October and has now drawn up a first research report. A digital currency would not be an alternative, but a supplement to central or book-entry money. Which technique to use for this is another thing to figure out. In any case, the ECB does not seem to allow the digital currency to become a cryptocurrency with a blockchain. Moreover, the currency must be centrally managed by the banks, because this guarantees its value. The prices of cryptocurrencies are too volatile, the bank says, and citizens should have confidence in the currency. Such a currency should make it easier to pay digitally, says the ECB. “A digital euro would be a digital symbol of progress and integration in Europe,” the bank says.
It remains to be seen whether the currency will come. The bank does not want to make a final decision on this until mid-year. The idea of a digital central currency is not entirely new. China has had a digital yuan since December.