we are taking the time and effort to understand
the significant implications of digital currencies
and CBDCs (central bank digital currencies)
around the globe.”
A task force of experts from the ECB and the 19
national central banks of the eurozone noted
that as demand increases for cashless payments,
there should be a Europe-wide, risk-free digital
system. They said the potential launch of global
private digital currencies could raise regulatory
concerns and pose risks for the stability of the
financial system.
Facebook last year proposed launching Libra,
a digital currency that would be backed by
existing government-issued money. Libra would
not be run by Facebook but by a nonprofit
association based in Switzerland. Central banks
and regulators have raised concerns about
privacy, money laundering and consumer
protection. The project suffered a setback
when high-profile financial companies such as
MasterCard and Visa left the project.
The technical basis could be so-called
distributed ledger technology, a decentralized
way of keeping track of payments, or the
existing ECB payment infrastructure, TIPS. The
private sector would then develop ways for the
currency to be used in practice by consumers.