The European Central Bank (ECB) has officially launched the digital currency (CBDC) project

The European Central Bank (ECB) has just announced that the Eurosystem has officially launched a project for the Central Bank’s digital currency (CBDC) in preparation for the possible issuance of a digital euro. The central bank has again claimed that their CBDC will be better than Bitcoin (BTC).

European Central Bank (ECB.)) officially launched the Digital Currency Project (CBDC)

The Governing Council decided today to initiate the investigation phase of the digital euro project, which is expected to last 24 months, according to the press release.

Specifically, this decision means that the bank will provide the necessary resources to develop a marketable product, said ECB board member Fabio Panetta, chairman of the special group digital euro senior, in his blog post.

“But the decision to issue a digital euro will only be made at a later date,” added Panetta.

ECB President Christine Lagarde noted that the decision was taken nine months after the bank’s report on the digital euro was released, in which it “conducted further analysis, sought input from residents and experts and conducted several studies with encouraging results”.

Lagarde added that

“All of this led us to the decision to accelerate and start the digital euro project. Our job is to ensure that citizens and businesses have access to the safest form of money, central bank money, even in the digital age. “

European Central Bank (ECB.)) officially launched the Digital Currency Project (CBDC) – Deployment Plan

The announcement goes on to say that a two-year study period will address key issues related to design and distribution, as the digital euro must meet the needs of Europeans and help prevent illegal activities while having undesirable effects on financial stability and monetary policy to avoid.

“This has no impact on future decisions about the possibility of issuing a digital euro, which will come later. In any case, the digital euro will complement, not replace, cash, ”emphasized the bank.

During this study period, the European banking system, consisting of the ECB and the national central banks of the member states whose currency is the euro, will focus on a functional design that is based on user needs, the inclusion of focus groups, the development of prototypes and the conceptual Work oriented.

According to Panetta, the ECB will work with the European Parliament and other European decision-makers, with whom the ECB will communicate its findings on a regular basis.

“People, merchants and the payments industry will also be attending,” he said. In addition, digital euro use cases will be tested during this period, which are intended to meet the goal of a “risk-free, accessible and effective form of digital central bank money”.

During this phase, the potential impact of the digital euro on the market will be further assessed. Design options for ensuring privacy and avoiding risks for the citizens, intermediaries and the economy of the euro area are shown and the business model for intermediaries to be approved is defined.

There will be a market advisory group to examine the views of potential users and retailers on the digital euro, which will then be discussed by the Euro Retail Payments Board.

The technical work on the digital euro with the European Commission is also being improved.

European Central Bank (ECB.)) officially launched the Digital Currency Project (CBDC) and criticized Bitcoin

The central bank never missed an opportunity to criticize the decentralized Bitcoin, claiming that “the euro’s core digital infrastructure will be environmentally friendly: For architectures tested in the last 9 months, the energy required to execute tens of thousands of transactions per second is tps becomes “negligible compared to the energy consumption of cryptocurrencies like Bitcoin.”

In the previous period, the ECB and the central banks of the member states carried out tests in:

Digital euro ledger;

Data protection and anti-money laundering;

Restrictions on digital euro circulation;

End users access while not connected to the Internet and facilitate integration with appropriate devices.

They claim to have found no major technical barriers to any of the design alternatives being evaluated. Both the TARGET Instant Payment Settlement (TIPS) from Eurosystem TARGET and alternatives such as blockchain are demonstrably able to process over 40,000 tps. “

CBDCs “will reach people’s lives in very intimate ways,” Lagarde told Bloomberg Television on Sunday. “What we’ve heard from people is that they want to protect their privacy. At the same time, we have to make sure that money laundering or terrorist financing is not accelerated, so we have to find the right balance in every respect.

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