In the rise of StableCoins, ECB is promoting digital Euro President Donald Trump has recently signed a Presidential order on Stullecoins, a US dollar.
In important movements for digitalization, the European Central Bank (ECB) has repeatedly commited to introduce digital Euro.
The promotion of ECB reflects a wider strategy to adapt to the evolving landscape of digital finance while maintaining the control of financial systems in Europe.
ECB is opposing recent presidential orders by Trump on StableCoins.
The motivation for the ECB digital euro is derived from the need to catch up with the rapid shift to digital payment, and the euro is increasingly associated with a cashless society.
According to Reuters, Piero Sipolon, a member of the ECB Board, emphasized the potential threats brought by Trump’s recent presidential orders, promoting global use of stubcoin -supported US dollar support.
Trump’s orders signed on January 23 aimed to promote the growth of these digital currency around the world, potentially separate customers from the conventional banking system, so that the banks do not confuse. I am.
Cipollone has dealt with the issue at a meeting in Frankfurt and emphasizes that such a movement in the United States could lead to a major change in financial dynamics. “This solution loses a bank, loses banks, a client that unravels the bank, so we need a digital euro,” he emphasized the urgency of the ECB project.
The trip to the digital euro began in October 2021, and ECB launched a pilot program to find out the feasibility and impact of such a currency. These programs are more widespread, especially for those issued outside Europe, especially those issued outside Europe.
Digital Euro not only ensures simpler and comprehensive payments, but also supports people without bank accounts, expanding financial access throughout the Euro area.
The promotion of ECB to digital euro is also a strategic movement to strengthen Europe’s autonomy in global financial environments. By reducing the dependence on non -European payment providers, digital Euro can rationalize transactions in Eurozon and become more expensive and more efficient.
Banks have expressed concerns about potential capital outflows
However, the introduction of digital Euro does not mean that there is no problem. Banks have expressed concern about potential capital outflows because customers may prefer the security of digital wallets supported by ECB rather than conventional accounts.
In response, the ECB set up a holding restriction to maintain digital Euro restrictions, introduces “waterfall mechanism” to manage the flow of currency, and the excessive amount remains outside the banking system. We propose protection methods such as not to prevent it.
In addition, the ECB does not pay interest to digital euros, but further suppresses large -scale accumulation.
In contrast to the US approach that has banned the issue of its own central bank digital currency (CBDC), indirectly indirectly with private stubcoin providers such as Circle, Tether, and PayPal. ECB, which supports, assumes a system performed by digital Euro. It is distributed through banks and other payment service providers as the responsibility of the central bank.
The purpose of this approach is to maintain the balance between innovation and regulations, and enable new financial technology to prosper while the central monitoring.