March 29, 2024

The ECB will limit the issuance of digital euros at the level of 1.5 trillion

The ECB will limit the issuance of digital euros at the level of 1.5 trillion

If the digital euro is launched, its emission will be limited to €1.5 trillion. This was stated by a member of the boardEuropean Central Bank (ECB) Fabio Panetta.

According to him, the EU authorities fear thatconsumers can digitize all their money, effectively moving it to the central bank. This will deprive commercial banks of the funds they need to lend to individuals and businesses.

A limited issue of the digital euro will help avoid negative consequences for the financial system and EU monetary policy. 

“Now there are about 340 million people living in the eurozone, this will allow you to store from 3,000 to 4,000 digital euros per capita,” Panetta said in a statement.

He added that the European Commissionin 2021, consultations among citizens did not show much “enthusiasm for a digital euro.” This is partly due to the “complexity” of the technology for the average user. 

However, Panetta urged not to attach too much importance to these findings, since “the consultation was not based on a representative sample of citizens.”

Let us recall that the initiative to issue a digital euro arose in November 2019. In October 2020, the ECB published a comprehensive report on this topic. 

In May 2022, Fabio Panetta allowed the issuance of a digital euro until 2026.

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