Home
News
Cryptocurrency has grown in popularity over the past several years and surged even more during the ongoing global health crisis. It’s that popular that central banks of some countries have been studying the feasibility of them having a digital version of their currencies. China has become the first nation to introduce its virtual money – the digital yuan.
The European Central Bank is likely to follow with a recent report emphasizing that a “digital euro” is essential in combatting what is deemed as “artificial currencies” introduced by big tech firms.
Digital Euro
For the uninitiated, the ECB has been vocal about their concerns surrounding stablecoins, whose emerging popularity in Europe is pretty much evident. So concerned that they requested lawmakers in the European Union to have some sort of regulatory powers to look over such digital currencies.
In their annual review – “The international role of the euro,” economists Massimo Ferrari and Arnaud Mehl cited one of their concerns in which non-domestic providers will significantly influence both domestic and cross-border payments. Their report did mention those “foreign tech giants” as they believe are poised to offer their brand of digital currency in the future.
No particular “tech giant” was mentioned on that part of the report, though it is believed that the statement is poking at Facebook since they’ve announced that a diem (initially named as libra) coin is in the works.
What are the Benefits
The report also stated that “a CBDC would have the potential to widen access to payment services, promote financial inclusion, and lower mark-ups of traditional intermediaries.” It noted that if the digital euro has become interoperable with non-domestic payment systems, it could either fill the gaps or correct inefficiencies in cross-currency payment infrastructures, including transfers of remittances.
Banque de France has been reported to be testing the waters with this digital euro. The financial institution noted that the entirety of the experimentation that was performed would contribute to such an endeavour.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
