The European Central Bank (ECB) has launched a new digital euro. report on the progress of investigations into the possibility of starting The investigation will continue next year, and regulators are expected to make a decision on whether to proceed with the project in the fall of 2023.
ECB to develop rules for digital euro circulation through intermediaries
Released a second report on progress in the investigation phase. This document presents a set of design and distribution options recently approved by the Council, defining the role of his ECB and market participants in the digital euro ecosystem.
Much like paper money today, the digital euro will be a liability on the balance sheet of the Eurosystem, the monetary authority of the eurozone, composed of the ECB and the central banks of its member states. The Eurosystem must therefore fully control the issuance and settlement of the digital euro, the regulator explains.
A supervised intermediary, such as a credit institution or payment service provider, distributes the digital euro to end users (individuals, merchants, businesses), opens his digital euro wallet and processes payments. , and other related services. Conducting Know Your Customer and anti-money laundering checks will also be part of their responsibility. The ECB also emphasized that:
Payments in digital euros should always be an option, regardless of the entity where the end user opens the digital euro account or wallet, or the country of origin.
Additionally, the European Central Bank has ensured that the design of the digital euro minimizes involvement in processing user data. “The Eurosystem cannot infer how much digital euros individual end-users hold or infer their payment patterns,” the monetary authority elaborated.
The research phase of the Digital Euro Project will begin in 2021. The ECB will publish its first progress report in September 2022. Work on the distribution scheme rulebook should start in January. The central bank’s board of directors will review the findings in autumn 2023 and decide whether to proceed to the implementation phase.
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