Digital euro can ward off a host of private payment service ills: ECB official
The European Central Bank (ECB) is quite happy with the European Commission's (EC) legislative proposals for the digital euro. ECB executive board member Fabio Panetta told the European Parliament’s Committee on Economic and Monetary Affairs in a speech on Sept. 4 that the proposals “put Europe at the forefront of advanced economies” in CBDC development, potentially heading off private dominance of the financial sector and the ills that implies.
The EC made its proposals public on June 28. Panetta, a critic of cryptocurrency, called the EC proposals for the euro central bank digital currency (CBDC) “a new paradigm for preserving monetary sovereignty” that would ensure Europeans always have access to a public payment option, whether it was cash or digital, even as “closed-loop solutions are becoming increasingly prevalent” in private payment services. Panetta compared private payment systems to private messaging, where users are pressured to join the most popular systems.
A digital euro would be a new form of central bank money, says Executive Board member Fabio Panetta. It is now up to legislators to ensure it would replicate key characteristics of cash in the digital sphere, particularly its privacyhttps://t.co/nQJzYylwpV
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The EC proposed giving the digital euro the status of legal tender, making its acceptance for payment mandatory. Panetta also praised the EC’s privacy proposals for the digital euro. He specified:
“Furthermore, the possibility to pay offline would provide cash-like privacy, with neither the intermediary nor the central bank processing the payment,” Panetta said.
The proposals also included reasonable pricing policies and allowing the ECB to maintain equilibrium in the
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