Germany and France want to start a pilot project for the e-euro this year. Meanwhile, behind closed doors, the CBDC is taking on more and more concrete forms.
The ECB is scheduled to start a pilot project on the digital euro this year. Federal Finance Minister Olaf Scholz called for this on the sidelines of a meeting with his French counterpart Bruno Le Maire on Wednesday. Accordingly, both countries are calling for an intensification of the European CBDC. Scholz emphasized that the e-euro could strengthen the international role of the currency and at the same time act as a counterweight to private-sector crypto currencies. Either way, Europe must be the leader when it comes to digitization, said the SPD candidate for chancellor.
In addition, the Federal Minister of Finance made it clear that the introduction of a digital euro should only complement cash. Scholz thus takes the same position as Christine Lagarde. The head of the ECB previously forecast in one Bloomberg-Interview that the starting signal for the E-Euro could be given in four years. The current advance by Scholz and Le Maire could now accelerate this development, because like that Handelsblatt reports, the CBDC is already taking concrete shape behind closed doors. Accordingly, they now want to work on a simpler variant of the e-euro. It shouldn’t be called E-Euro, but “Digital Euro”. The blockchain technology, which had repeatedly been associated with the prestige project, did not play a role. Rather, build on the Italian real-time transfer system “TIPS”. However, this must be upgraded again for the digital euro.
An upper limit is also being discussed. Accordingly, citizens should be able to keep a maximum of 3,000 e-euros in their “wallet”. The aim is to prevent the banking system from being undermined by withdrawing customer deposits. If someone exceeds the specified maximum amount, the excess amount will be transferred to the person’s account. At the moment one is still dealing with the question of how one can prevent people from simply opening “wallets” at several banks.
These are the demands of EU citizens on the e-euro
The results of the ECB survey published in mid-April should undoubtedly also influence the decision-making process. In it, the central bank asked EU citizens about their wishes and ideas for a digital euro. In addition to core concerns such as “privacy” or “security”, many called for integration into the existing financial and payment system with strict monitoring and licensing of intermediaries in order to avoid data misuse and security concerns and to ensure consumer protection.
It remains to be seen whether and how much of the rumors that are currently circulating will come true. In July, the Governing Council wants to decide on the relevant key points.