ECB explains the importance of the digital euro for maintaining financial stability

Economists at the European Central Bankbelieve that the digital euro is important for the future of the financial system, as it can withstand “artificial currencies” issued by private companies.

The latest ECB report says that in the futurelarge corporations may issue their own artificial currencies, which will begin to dominate international and domestic payments. The dominance of a small group of private foreign suppliers will pose a threat not only to individual individuals and legal entities, butand the stability of the financial system as a whole.

According to the report's authors, digital currencyCentral Bank DC (CBDC) is able to successfully compete with such artificial currencies and resist their dominance, helping to preserve the autonomy of payment systems. However, this will require offering additional products and services based on the digital euro, expanding its scope.  

Additional Benefits of Using CBDCECB economists attribute the modernization of payment infrastructure and lower transaction costs, which will help expand global commerce. The authors also emphasize the need to stimulate the use of the digital euro by ensuring user anonymity and the ability to conduct offline payments.

Late last year, the Governing Council of the European Central Bank noted other benefits of introducing digital currency into the financial system.

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