Digital Euro to Boost Global Appeal of European Money, Fight ‘Artificial Currencies’ – Finance Bitcoin News

Digital Euro to Boost Global Appeal of European Money, Fight ‘Artificial Currencies’ – Finance Bitcoin News 1
Digital Euro to Boost Global Appeal of European Money, Fight ‘Artificial Currencies’ – Finance Bitcoin News 2

Now that the European Union has committed to its own digital currency, the European Central Bank has issued a warning. As it notes, “there are a number of digital currencies that have been introduced or are under development.” It goes on to suggest that these new currencies could be used as a method to circumvent regular regulations and oversight.

In short, Europol wants to create a common digital currency for all Europeans, to prevent it from being used for criminal activities. An initial test will be in the form of the EU’s own cryptocurrency, which will supposedly be called ‘EURS Token.’

The European Commission (EC) will be presenting on Wednesday, August 28th a new initiative to boost the use of the Euro as a means of payment around the world. This will come as part of the Budget 2019, and constitute a two-pronged approach to making the Euro more widely understood, and hinder the use of digital currencies outside the Eurozone.. Read more about why is cryptocurrency valuable and let us know what you think.word-image-1038 According to a new report from the European Central Bank, the digitization of traditional currencies such as the euro could increase their international appeal. The failure of a digital currency would put financial stability at risk, the ECB warns. The regulator is concerned about the prospect of tech giants dominating payments with their artificial currencies.

The euro area central bank examines the role of the euro in relation to the CBDC project

The global appeal of fiat currencies depends on economic fundamentals, but certain features of digital money may make them more readily accepted outside the country of issue, the European Central Bank (ECB) said in a recent report on the international role of the euro. Specific design features may also encourage non-residents to use the digital euro as a means of payment, unit of account and store of value, the regulator said. word-image-1039 Security is critical, the bank notes, as the central bank’s digital currency (CBDC) must be on the issuer’s balance sheet and can mitigate the risks associated with traditional cross-border transactions with correspondent banks. The CBDC will also reduce transaction costs, improve access to payment services and reduce intermediary margins. For example, money transfers can become more efficient. The euro area central bank believes that even in countries with fragile economies, the CBDC can fully or partly replace the unstable national currency by becoming a local payment instrument, a means of saving and possibly a unit of account. Digital money will facilitate the use of electronic notes, receipts, identity cards and signatures. End users can access products that compete with the offerings of large technology companies.

ECB worried about dominance of foreign technology groups in payments

The European Central Bank stresses that the CBDC will help to preserve the autonomy of national payment systems. On the other hand, the inability of a central bank to offer a digital currency would pose risks to the stability of the financial system. The authors of the CBDC section of the report, Massimo Ferrari and Arnaud Mel, caution: A concern could be a situation where domestic and cross-border payments are dominated by foreign providers, including foreign technology giants that could offer artificial currencies in the future. Companies like global social media platform Facebook are working on creating their own currencies, which can quickly gain popularity due to their large customer base. Not only could this jeopardize the stability of the financial system, economists say, but it would also leave individuals and traders at the mercy of a small number of dominant providers with strong market positions. Ferrari and Mehl believe that the ability of central banks to fulfill their monetary policy mission and their role as lender of last resort will suffer. word-image-1040 The study, published Wednesday, also examines alternative design options for digital currencies, noting that specific features will determine the global reach and international role of the currency in which CBDCs are denominated. These features include compatibility with external payment systems, restrictions on use by non-residents, user anonymity and an underlying mechanism for online and offline transfers and payments. A digital euro could help increase its global appeal, but will not change the fundamental forces that determine the status of an international currency, such as the fact that the euro is a global currency. B. stable fundamentals, the size of the issuing economy and the liquidity of financial markets, the report concludes, noting the importance of cooperation with other central banks in the G20. The ECB has not yet launched a digital euro project. Officials had previously indicated that a board decision could be expected around mid-2021. Dozens of countries are already working on CBDCs, including China, the United States and Russia. How about digital currencies from central banks? Share your thoughts on this topic in the comments section below.

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CBDCs, CBDCs, central bank, central banks, currency, digital currency, digital euro, euro, Europe, European Central Bank, Eurozone, Facebook, tech giants. Photo credit: Shutterstock, Pixabay, Wiki Commons Denial: This article is for information only. It is not a direct offer or invitation to buy or sell, nor is it a recommendation or endorsement of any goods, services or companies. does not provide investment, tax, legal, or accounting advice. Neither the company nor the author shall be liable, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services referred to in this article.This week, the European Central Bank (ECB) announced an initiative to create a digital currency for the Eurozone. The ECB hopes the move will help boost the international appeal of the currency and to counter the rise of cryptocurrencies like Bitcoin. The ECB, however, isn’t the first to try the idea. Japan’s central bank has proposed a similar currency, dubbed “J-Coin”, and the US Federal Reserve has also been experimenting with a digital money.. Read more about when was bitcoin at its lowest and let us know what you think.

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