Yes, I quite agree with what you say, but I also have a few other points that are contradictory to all that:
- The digital euro could enable faster, safer and more efficient payments, especially for cross-border transactions.
- The digital euro could stimulate innovation in financial services, encouraging the development of new applications and business models.
Another thing, you say that the ECB can't create legal tender. Actually, I've been reading up on this too, and it seems to me that this statement is partially true. The ECB cannot directly create legal tender for the general public. However, it does have several indirect means of influencing the creation of digital currency:
- The ECB can create digital reserves for commercial banks. These reserves are considered a form of central bank money and can be used by banks to settle debts between themselves. The ECB could, in theory, decide that these digital reserves can also be used for transactions with the general public, effectively making them legal tender.
- The ECB could also consider issuing digital euros directly to the general public. This would require a modification of the European treaties, but would give the ECB total control over the creation and management of digital currency (I don't want to get ahead of myself, but I think this discussion has already been put on the table).
I don't know much about it, so this isn't an attack on your article ^^
It's mostly that I wonder a lot about what's being done in the world. And in general I always have counter-examples. But I'd love to know what you think.
In the end, I agree on the non-utility of the digital euro.
Certainly if they change the laws, then what is presently prohibited could be allowed. Of course, if the ECB was able to issue the digital currency to the public, then the commercial banks could become irrelevant. This was part of the motivation for the ECB putting out this information.
That is true but it doesnt enter the money supply. It is not legal tender but rather a bank instrument. The Fed does the same yet the only ones who are able to have reserves are those with master accounts (i.e. banks).
Insurance companies, hedge funds, or the local church cannot have them. Hence the Fed and ECB are not creating dollars are euros unless the reserves are converted by the commercial banks into banknotes (something that isnt going to happen since cash is a dying animal).