Christine Lagarde, President of the ECB, spoke about the digital euro at the Governing Council meeting on 21 January.
A proper implementation of the digital euro would benefit everyone, not just the elite or young people.
The ECB is taking steps towards a CBDC as technology advances (as well as the threat of foreign CBDCs).
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The President of the European Central Bank (ECB), Christine Lagarde, stressed that a digital euro is not just for the elite or young people.
On 23 January, the European Central Bank (ECB) published a tweet in which its president, Christine Lagarde, described a correctly implemented digital euro as a „service for all citizens“.
A digital euro, if it were to be introduced, would be of service to all citizens. But we are not there yet – more work is needed to address the issues it raises.
https://t.co/RiwOCers68 more about a digital euro ⁰Learn pic.twitter.com/uUEhkHL5B2
– European Central Bank (@ecb) January 23, 2021
A digital euro, if adopted, would benefit all citizens. However, we are not there yet; efforts must continue to address the problems it raises.
Ms Lagarde made her statement at the ECB Governing Council meeting in Frankfurt am Main.
China has been noticed by the ECB
Ms Lagarde began her statement on the overall usefulness of the digital euro by noting the uses of the digital currency of central banks (CBDCs) in other countries. In particular, she mentioned the Chinese pilot programme „on a fairly large scale“.
China’s digital yuan figures prominently in the ECB’s plans for a European CBDC. In November 2020, the ECB described its initial concept of a European CBDC at the conference on the future of payments in Europe in Frankfurt am Main. Fabio Panetta, member of the ECB’s Executive Board, said that the central bank wanted to ensure „efficient, inclusive and secure payments in the digital age“.
However, Mr. Panetta also referred to the double threat of stable corners and especially foreign CBDCs. For bankers, the use of a foreign CBDC as the main means of payment by European citizens is a threat to the sovereignty of the eurozone. Moreover, these comments were made at a time when China is in the process of deploying the digital yuan in its retail environment.
Should they be worried?
China’s digital currency plans include international expansion. On 16 January, China’s Blockchain Service Network (BSN) announced its plans for 2021. The BSN only announced the blockchain’s overseas expansion. Among its ambitions is the expansion of BSN’s nodes in 50 cities in developed and developing countries.
At the same time, BSN plans to continue enabling the deployment of the digital yuan in China. The ECB will follow these two developments with some concern, according to November’s statements.
Changes in the U.S. federal government will set the course for the development of a U.S. CBDC over the next four years. Currently, the US is lagging behind the Eurozone and China.
Washington is in no hurry to catch up. US Federal Reserve Chairman Jerome Powell told Yahoo Finance on Thursday 14 January that the creation of a US CBDC is proving to be a prudent course of action. Powell also told Yahoo Finance that for him, the United States has an advantage as the first country to establish itself because the dollar is the world’s reserve currency.