Banks continue to raise objections that have already been accounted for in digital euro design, the authors say.
The European Central Bank (ECB) has been producing plenty of informational material about the digital euro lately, much of it in the form of brochures, FAQs and other accessible formats. As they do so, the bankers’ frustration with overblown fears and the cold reception the innovation has been given is beginning to show.
ECB executives, including board member Piero Cipollone, published a column in two versions on Feb. 19 addressing issues of bank intermediation. Specifically, they discuss banks’ perceived confusion about disintermediation potentially resulting from the introduction of a euro central bank digital currency (CBDC):
The authors briefly describe on the ECB blog several measures designed into the digital euro to prevent mass transfers of money from commercial bank accounts into digital euro wallets. These design elements encourage the use of the digital euro for payments rather than investment and the authors pointed out that banks could compete to retain deposits by raising their interest rates.
