Crypto Community Unimpressed as ECB President Pushes for Digital Euro with Privacy ‘of the Highest Standard’
The European Central Bank (ECB) President Christine Lagarde's new blog post again pushes for the creation of a central bank digital currency (CBDC) in Europe. But although it argues that a digital euro would protect the privacy of its users, the crypto community is not impressed.
The new article, written jointly by Lagarde and the ECB Executive Board Member Fabio Panetta, published on the ECB’s website, stressed the importance of making sure the public has access to central bank money for payments, meaning cash or a digital central bank-issued currency.
The alternative they said, is that the private sector fills this hole in the market, and that new payment solutions – which are reliant on private bank deposits and often controlled by non-European companies – take over.
This could create “confusion about what qualifies as money,” the article said.
Another potential threat the pair sees is crypto, which they said “cannot guarantee one-to-one convertibility with central bank money.”
The article added that crypto, and in particular the so-called unbacked cryptoassets, are “not an efficient means of payment.” It also noted that so-called backed cryptoassets – known as stablecoins – “are vulnerable to runs.”
The piece further stressed that a digital euro would “complement cash,” and “not replace it.”
A digital euro “would expand the availability of digital central bank money beyond its current use – for transactions between banks – to also include everyone’s daily payments,” it said, while adding that a digital euro would “ensure that citizens can continue to trust in the monetary anchor behind their digital payments.”
Meanwhile, Lagarde and Panetta admitted that a digital euro would only become successful “if it becomes part of
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