European Central Bank (ECB) governor Fabio Panetta commented on the growing need, benefits and security of central bank digital currency (CBDC).
European Central Bank (ECB) board member Fabio Panetta said the European regulator fully supports research into the digital euro as consumers of financial services increasingly turn to digital currencies, and there is a possibility that traditional cash will one day completely go out of circulation.
Panetta explained that in considering this scenario for the ECB, it is important that people continue to use currency that is backed and issued by the state central bank rather than any third party.
At the same time, the ECB does not intend to compete with the national banks of the Eurozone.
“The ECB will issue the digital euro, but will not distribute it or have access to the personal data of CBDC holders.
Citizens won’t have accounts at the ECB and it doesn’t make sense for us to be in this business.
We’re not looking to get a big market share, we want to be present but not dominate anywhere,” Panetta said.
Regarding the financial intermediaries that will be charged with distributing the digital euro, Fabio Panetta noted the need to find a balance between ensuring data privacy and combating money laundering and terrorist financing.
In early May, the European Central Bank, together with London-based analyst firm Kantar Group, conducted a survey among potential users of the digital euro on expectations for the CBDC’s future functionality.