European Central Bank executive commissioner Fabio Panetta said that the European Central Bank needs to issue a digital euro because measures initiated by the private sector such as the full ceding of space to stablecoins may endanger financial stability and weaken the role of the central bank.

The European Central Bank has been working on designing a digital currency that is directly issued by the central bank like cash, but the project may still take about five years to launch a real currency.

Panetta said: “Just as stamps have lost a lot of use with the advent of the Internet and e-mail, cash may also lose its meaning in an increasingly digital economy. If this becomes a reality, it will weaken the central bank’s currency as a currency anchor. The validity of the decision.

History shows that financial stability and public trust in currency require public currency and private currency to be widely used together. To this end, the digital euro must be designed to make it attractive to be widely used as a means of payment, but at the same time to prevent it from becoming a successful way to preserve value, causing a run on private currencies and increasing the risk of bank operations. ”

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Post time: Nov-08-2021