European Commission Vice President Valdis Dombrovskis has made financial stability the centrepiece of a new push to convince member states and the European Parliament to endorse a digital version of the 20-nation common currency. A digital euro, he argues, is essential so that the EU does not fall “behind the curve” in global payments, private-label digital currencies and electronic versions of central bank money.
, is essential so that the EU does not fall “behind the curve” in global payments, private-label digital currencies and electronic versions of central bank money.
Under the proposal, the European Central Bank would have control over who can use the digital euro, how it will be used internationally, and how much people can hold at one time. At the same time, the plan calls for a digital European currency to have an international role, part of efforts to shore up the euro as a global reserve currency.
Europe’s steady march forward contrasts with the wait-and-see approach of the U.S. Federal Reserve and the focus on financial innovation in preparatory work at the Bank of England. The EU plan calls for the digital euro to be accepted as legal tender almost everywhere, at no cost to ordinary consumers. Instead, expenses would be borne through fees just as electronic card payments are now. The ECB, meanwhile, has been working with companies like Amazon.
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