European Commission Publishes Legislative Plans For A Digital Euro

The European Commission has released its legislative plans around a digital euro. The commission has said it plans to see the digital euro used to make free digital payments across Europe.

European Commission Releases a digital euro bill

The legislative plan has included provisions for financial stability and privacy. The text has been released at a time when there are many concerns about the potential benefits of a central bank digital currency (CBDC).

In a statement published on the commission’s website, the Executive Vice President, Vladis Dombrovskis, said that a digital euro came with strategic benefits. The CBDC would boost the safety and integrity of the European payment sector at a time when geopolitical tensions in the region are high. He also noted that a digital euro would complement and not replace cash.

“It would be safe and secure, instant and convenient – online and offline – offering more consumer choice alongside with private digital payment options such as cards and apps. And it would be available for everyone to use, free of charge and with strict data privacy.

In the same statement, Commissioner Mairead McGuiness said that it was vital to bring the euro into the digital age. Digital currency complemented cash and offered many benefits to citizens and businesses in the European Union.

ECB will decide on the issuance of a digital euro

The Commissioner also said that the process for creating the digital euro would attract the participation of the European Parliament, Council, and the European Central Bank. The ECB will make the tentative decision on whether issuing a digital euro is feasible.

Officials from the ECB have argued that a CBDC will offer private payments and higher safety standards. Nevertheless, many critical players have remained opposed to the bill, including lawmakers and some government officials who are needed to approve this new bill. A digital euro also appears to be attracting skepticism from commercial banks as its launch would undermine the digital frameworks set up by these institutions.

The ECB published a statement saying that it welcomed the plans of the commission regarding a digital euro. It further said that later this year, it would announce whether it would progress to the next phase of this project.

The President of the ECB, Christine Lagarde, said that the bank was looking forward to working with other institutions in the EU to establish a digital euro. This currency would guarantee that the region’s currency adapts to the new digital era.

The legislative plans by the European Commission have focused on the key features of the digital euro. The proposals want to guarantee that the digital euro can be used offline. It further wants to ensure that it can provide the same level of privacy as cash.

The proposals have also barred the CBDC from being programmed in a manner that will limit the goods it can be used to purchase. However, the officials have said that the digital euro could still be used to support conditional payments, including recurring expenditures such as utility bills and monthly payments.