The head of the eurozone’s monetary authority stressed that the digital euro plays an important role in maintaining Europe’s payment autonomy. During the central bank’s discussion on digital currencies, Christine Lagarde affirmed that “the new currency, still under development, is meant to be sovereign, secure, cheap and widely available.”
Payment cards and apps now are not a European necessity, Lagarde noted
European Central Bank (ECB) President Christine Lagarde was quoted as saying at a virtual panel on central bank digital currencies (CBDC) hosted by the Bank for International Settlements (BIS) that the digital euro will play a key role in protecting Europe’s payments autonomy.
Lagarde elaborated to Bloomberg, “If you look at your wallet or your phone, at the applications you use to pay and the cards you use to pay, you will quickly realize that those payment methods are not necessarily European.”
In a discussion held and recorded in early March and posted on Tuesday, the ECB head warned against relying on a single source for important aspects of daily life, citing Russia’s decision to weaponize its energy supply after the invasion of Ukraine, adding:
So we just have to be careful. Some will call it sovereign autonomy, but I prefer to call it resilience, because that is really what it is.
The project to issue a digital version of the euro remains in the exploratory phase, which began in mid-2021; in December 2022, the ECB published its secondreport on progress at this stageand in January 2023, finance ministers from euro area countries
Last November, Lagarde said that Brussels would soon have a draft CBDC law. The European Commission is expected to propose a legal framework by the end of June. A final decision on whether to proceed to implementation should come later this year.
Christine Lagarde highlighted the trend of increasing digital payments while the use of cash is shrinking. She noted that digital euros are intended to be secure, sovereign, and available “at the lowest cost.”
However, she also acknowledged that they cannot offer the same privacy as paper bills.” Digital currency will never provide the anonymity of cash,” she acknowledged, adding that for that reason “cash will always be around.”
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