The European Central Bank’s two-year research program on central bank digital currencies has concluded and is now ready to enter the next phase.
On October 18, the ECB’s Governing Council said it had decided to move to the next phase of the digital euro project.
After completing a two-year investigation phase, a potential European CBDC has entered the preparation phase.
The preparatory phase will begin on November 1 and will initially last two years. It will involve finalizing the digital euro rulebook, selecting technology providers and testing.
Digital Euro in two years?
The preparatory phase will be completed by the end of 2025, after which the ECB will decide whether to proceed with the actual issuance of a CBDC. This decision will only be made after the EU legislative process is completed, which may take until next year.
“The launch of the preparatory phase is not a decision on whether to issue a digital euro,” it confirmed.
Patrick Hansen, Circle’s director of EU strategy and policy, said that ultimately, the EU’s legislative bodies — the EU Parliament and the EU Council (member states) — will decide whether to launch a digital euro, adding:
“The legislative process is currently underway and discussions on the European Commission’s proposal have already begun, but it may take some time (until after the EU elections in June 2024) before the EU institutions can vote on the topic.”
The proposed digital euro will be a digital form of cash that allows private offline payments. According to the announcement, it will be widely accessible, free for basic use, and offer the highest privacy standards.
“We need to prepare for a future where money will coexist with physical cash, which will always be available, leaving no one behind,” said European Central Bank President Christine Lagarde.
Users will be able to access digital euro services through their bank or the “Eurosystem” app. People without bank accounts can use cards from public entities such as the post office.
The latest outlook for CBDC
Earlier this month, the Bank for International Settlements (BIS) and the central banks of France, Singapore, and Switzerland announced the successful completion of a new CBDC initiative called Project Mariana.
According to the Atlantic Council’s CBDC Tracker, 11 countries have deployed CBDCs, most of which, with the exception of Nigeria, are in the Caribbean.
Nonetheless, several U.S. senators have strongly opposed CBDCs, claiming that they would erode financial privacy and enable state surveillance. #CBDC #欧盟
