Digital Euro: How will it affect the economy and businesses?
Posted: Wed Dec 18, 2024 8:54 am
The European Central Bank is seriously considering the creation of its own digital currency: the digital euro , which would complement existing payment methods.
A group of experts is already studying its implications and its implementation. The opinion will be issued in 2023.
One of the challenges will be to ensure the privacy and security of the use of this type of currency.
The digital euro could be getting closer. The European Central Bank (ECB) is already considering the option of countering the adoption of cryptocurrencies with its own digital currency: the digital euro.
Start of marked textTWEET IT! What are the main advantages and challenges of the digital euro?End of marked text
A committee of experts in the electronic payments industry, the Market Advisory Group , will be the one to determine the feasibility of bringing a digital euro to market. For dominican republic email list the moment, they have given themselves until October 2023 to study this option and issue an opinion.
What is the digital euro?
Talking about a digital currency at European level leads us to ask what the digital euro is. It is a virtual currency associated with the main means of payment in the European Union: the euro.
It would be a form of electronic money, issued by the European Central Bank and the national central banks of the euro area. It would also be accessible to all citizens and businesses.
The ECB warns that the digital euro would not replace cash , but rather complement it. In this sense, this form of payment would give citizens an additional option on how to pay and would facilitate its use, contributing to accessibility and inclusion.
Challenges of the digital euro for the economy and businesses
Uses of the digital euro
One of the main challenges for a eurozone digital currency will undoubtedly be to identify relevant use cases. In this way, the stated objectives can be achieved. To date, the focus is likely to be on a possible functional design based on user needs, which may vary from one country to another.
As it is being introduced in different countries, there is also a great diversity of cultures and customs when it comes to paying. For example, in the Netherlands people use the “request payment” to ask others to reimburse them for a shared expense that they have covered. This practice is not common in other countries. In other areas, it can be the other way around, and people can reimburse someone on their own initiative, if they wish to do so. This means that different payment solutions are needed for different countries in Europe.
Technological level
Countries such as Sweden, the Netherlands and Spain are already well advanced in digitalising payments . Many of them are already made electronically. In other countries, the situation is different. This means that there are different needs to be met in different countries. Therefore, it will be necessary to look at how to introduce the best possible digital euro for everyone.
Privacy and security
There are different technologies, both centralised and decentralised, that can be used when developing a digital euro. To this end, European users were asked what they think the digital euro should contain. Among the priorities they indicated were privacy and security . One challenge in this regard is that transaction monitoring is necessary, among other things, to combat money laundering. Of course, this monitoring has to comply with all regulations so that privacy is not compromised.
A group of experts is already studying its implications and its implementation. The opinion will be issued in 2023.
One of the challenges will be to ensure the privacy and security of the use of this type of currency.
The digital euro could be getting closer. The European Central Bank (ECB) is already considering the option of countering the adoption of cryptocurrencies with its own digital currency: the digital euro.
Start of marked textTWEET IT! What are the main advantages and challenges of the digital euro?End of marked text
A committee of experts in the electronic payments industry, the Market Advisory Group , will be the one to determine the feasibility of bringing a digital euro to market. For dominican republic email list the moment, they have given themselves until October 2023 to study this option and issue an opinion.
What is the digital euro?
Talking about a digital currency at European level leads us to ask what the digital euro is. It is a virtual currency associated with the main means of payment in the European Union: the euro.
It would be a form of electronic money, issued by the European Central Bank and the national central banks of the euro area. It would also be accessible to all citizens and businesses.
The ECB warns that the digital euro would not replace cash , but rather complement it. In this sense, this form of payment would give citizens an additional option on how to pay and would facilitate its use, contributing to accessibility and inclusion.
Challenges of the digital euro for the economy and businesses
Uses of the digital euro
One of the main challenges for a eurozone digital currency will undoubtedly be to identify relevant use cases. In this way, the stated objectives can be achieved. To date, the focus is likely to be on a possible functional design based on user needs, which may vary from one country to another.
As it is being introduced in different countries, there is also a great diversity of cultures and customs when it comes to paying. For example, in the Netherlands people use the “request payment” to ask others to reimburse them for a shared expense that they have covered. This practice is not common in other countries. In other areas, it can be the other way around, and people can reimburse someone on their own initiative, if they wish to do so. This means that different payment solutions are needed for different countries in Europe.
Technological level
Countries such as Sweden, the Netherlands and Spain are already well advanced in digitalising payments . Many of them are already made electronically. In other countries, the situation is different. This means that there are different needs to be met in different countries. Therefore, it will be necessary to look at how to introduce the best possible digital euro for everyone.
Privacy and security
There are different technologies, both centralised and decentralised, that can be used when developing a digital euro. To this end, European users were asked what they think the digital euro should contain. Among the priorities they indicated were privacy and security . One challenge in this regard is that transaction monitoring is necessary, among other things, to combat money laundering. Of course, this monitoring has to comply with all regulations so that privacy is not compromised.