The European Central Bank is considering the launch of its own CBDC, according to the bank’s President – Christine Lagarde. She indicates in a recent interview that they need to adjust to this changing world and that the bank will not interfere with any private companies in coming up with a similar digital form of payment.
ECB’s Plans For Its Own CBDC
The President of the European Central Bank, Christine Lagarde, recently had an interview where she spoke about numerous financial topics, including an eventual launch of a central bank digital currency (CBDC). According to her, the ECB does not want to fall behind the current trend, saying that “[we] want to play an active role in this field, rather than just acting as observers of a changing world.”
She also covers the bank’s current status and plans concerning CBDCs:
“In terms of the road ahead, the ECB will continue to assess the costs and benefits of issuing a central bank digital currency (CBDC) that would ensure that the general public remains able to use central bank money if the use of physical cash eventually declines. […] We are looking closely into the feasibility and merits of a CBDC, also because it could have major implications for the financial sector and for the transmission of monetary policy.”
Lagarde talks about the recently established expert task force at the ECB, which reportedly works closely with the national central banks to research the potential benefits of a digital euro.
ECB’s Stand For Private CBDC
Lagarde also mentions the idea of CBDC’s issued by the private sector, such as projects like Facebook’s Libra. She urges for lack of interference in this manner, saying that “the prospect of central bank initiatives should neither discourage nor crowd out private market-led solutions for fast and efficient retail payments in the euro area.”
On the other side of this argument stands the President of the German Central Bank, Jens Weidmann. As Cryptopotato reported recently, he thinks that the central banks should do whatever they can to minimize the need for privately-owned digital currencies.
Furthermore, he also appears cautious about the digital euro. Weidmann noted that that the E.U. and ECB should be more considerate and careful before launching such a product, and that before they must define the real purpose before it’s launched to the public.