German central bank president calls for swift adoption of CBDCs to stay competitive.

The President of the German central bank, Joachim Nagel, has called for the rapid implementation of central bank digital currencies (CBDCs) in order to maintain competitiveness. Nagel, who is also a member of the European Central Bank (ECB), highlighted the need for central banks to adapt their business models to the changing landscape of the financial industry. Speaking at the Bank for International Settlements (BIS) Innovation Summit, Nagel expressed concern about the uncertain future of central banks and acknowledged the potential of distributed ledger technology (DLT) as a crucial tool in this transformation. He emphasized the urgency for central banks to act swiftly due to the decreasing popularity of physical currency. Nagel’s sentiments were shared by Bank of France governor Francois Villeroy de Galhau, who advocated for the integration of digital currencies into central bank operations to maintain stability within the financial system. The ECB is currently working on the development of a digital euro, while the Swiss National Bank is exploring the use of wholesale CBDCs. However, the Chairman of the Swiss National Bank cautioned against the issuance of retail CBDCs, citing potential risks that outweigh the benefits.