The introduction of a digital euro still lacks a convincing narrative in order to be accepted by the population. That’s still a lot of work, said Robert Holzmann, governor of the Austrian National Bank (OeNB), on Thursday at a conference in Brussels. However, a digital euro is important for European sovereignty and can promote social inclusion.
“Money is an important public good,” Holzmann said at the event organized by the National Bank of Belgium. Other countries would also be working on digital currencies. It is feared that if a stable and easy-to-use digital currency were created here, it could displace the euro as a means of payment. “We don’t have to be first, but we have to be prepared.”
Holzmann also hopes that a digital euro issued by the European Central Bank (ECB) could advance the project of a Europe-wide payment system as an alternative to American systems such as Visa, Mastercard and PayPal. And: Since cash is becoming increasingly less important, it is important to offer people on the fringes of society an alternative so that they can pay digitally. The fear that a digital euro could displace cash and be used for surveillance was also addressed. The governor of the National Bank of Belgium, Pierre Wunsch, complained that the debate was not being conducted rationally: “It’s not about control.”
Alternative to Bitcoin
The euro in digital form, if introduced, should be seen as an addition to cash and as an alternative to private digital currencies such as Bitcoin, explained Evelien Witlox, program director for the digital euro at the ECB. The way the digital currency is now planned, privacy will be protected and you can pay free of charge, like with cash.
In June, the EU Commission presented a legislative proposal with framework conditions for a digital euro. The member states and the European Parliament still have to agree to the text. In the end, the ball is in the ECB’s court as to whether it will issue a digital version of the euro. This October, the central bank will first decide whether the project will move into a more concrete planning phase after a two-year investigation phase.