On Monday, the European Central Bank will launch public consultations and tests in an effort to decide on the establishment of a "digital euro" for the 19 single currency countries.
The move comes as the Covid-19 outbreak accelerates the abandonment of banknotes, while policymakers are anxiously watching the rise of private cryptocurrencies such as Bitcoin.
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Here is an illustration of what the "digital euro" will mean for the region.
What is the digital euro?
The digital or virtual euro will be an electronic version of euro banknotes and coins, and it will be an official currency guaranteed by the European Central Bank.
It will also allow, for the first time, individuals to deposit directly with the European Central Bank.
This may be safer than depositing money with commercial banks that may go bankrupt or keeping banknotes that may be stolen or lost.
Like cash, funds can be kept outside the banking system, in a "digital wallet", for example.
It would allow individuals and companies to make daily payments in a "fast, easy and secure way," the European Central Bank said when it published a report on virtual funds this month.
The bank emphasized that the digital euro would be "a complement to money and will not replace it."
Digital Euros can be issued or transferred using a ledger technology known as "blockchain" or "blockchain", which is a public database that cannot be edited and is the very same cryptocurrency like Bitcoin depends on.
why now?
The COVID-19 outbreak has boosted electronic payments as consumers avoid banknotes and coins for fear of contagion.
Even in Germany, where banknotes are said to still dominate the scene, for the first time this year customers are expected to spend more money using cards than cash, according to a recent report by market research firm Euromonitor International.
Like other central banks around the world, the European Central Bank also fears that it will lag behind the virtual currencies issued by foreign private parties such as Bitcoin or Libra, the currency Facebook is expected to launch.
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It's coming which is good. At least in my humble opinion.
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Exactly
Digital or "analog" - not really a difference. It will still be FIAT, well... now a digital FIAT on the blockchain.
With banksters still holding keys of it's PRINTER. Which is the major, main drawback.
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Respect your opinion at all
they really don't consider names