The European Central bank says Europe should be ready to launch a digital Euro as a complement to physical cash.
According to an announcement made October 2, European Central Bank (ECB) executive board member Fabio Panetta says the EU must be prepared to issue a digital Euro. The report highlights the spread of digitalization in all areas of modern life, creating an increased demand for immediacy in consumerism, work, and economic interaction. Panetta calls digitalization disruptive, having an impact on the cultural, social, and economic fabric of the mainland continent.
He writes,
The way we pay is no exception. Our practices are changing – in some countries rapidly so. Not long ago, cash was the only way to pay instantly. It is still the dominant payment method for small amounts. But the trend is towards cashless, contactless payments. We are increasingly making purchases using tap-and-go cards, an app on our phone or even a smartwatch.
Panetta calls upon central banks around the world to ask themselves whether a digital currency should be issued to complement cash. He notes the lack of a fully digital currency as a potential blindspot for digitalization, saying that the ECB must consider creating a counterpart to the euro.
He continued, calling the digital euro a “pressing” issue and said that Europe should be ready to issue a digital currency “if and when developments make it necessary.”
Panetta’s update coincided with the release of an ECB report on digital currencies. Among a number of conclusions, the report said the ECB would be experimenting and soliciting feedback on digital currencies in the coming months in anticipation of creating a full-scale digital euro.
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