When Is the Digital Euro Coming Out? Central Banks Embrace Blockchain
The EU has been warming up to CBDC after lagging behind other countries including China. When is the digital euro coming out? Central banks have been embracing block chain.
Feb. 14 2022, Published 8:24 a.m. ET
Globally, central banks are looking at sovereign-backed digital currencies amid the rising popularity of digital assets. China has been among the pioneers when it comes to digital currency. When is the digital euro coming out?
Regulators globally have different views of digital assets. While some countries like Portugal have emerged as crypto tax havens, others like India have imposed a heavy tax on crypto profits. While some countries are apprehensive about cryptocurrencies, most of them are embracing blockchain, which is the technology behind cryptocurrencies.
What are the plans for a digital euro coin?
The EU plans to bring a bill on the digital euro in 2023. EU Finance Chief Mairead McGuinness confirmed that the block is looking to launch a digital euro. She said, “Our goal is to table legislation in early 2023.” She added, "A targeted legislative consultation in the coming weeks."
China has a digital yuan project.
China is running its pilot digital yuan project. The country experimented with the digital yuan at the Beijing Winter Olympics where it has rivaled Visa's dominance in payments. The event has been controversial amid the diplomatic boycott by several western countries including the U.S.
India has announced its digital currency and expects to launch it in fiscal 2022–2023, which would end in March 2023. While India also imposed a steep tax on crypto profits, it has clarified that taxing private digital assets like cryptos doesn't mean that it's legalizing them.
The Fed is also contemplating launching a digital dollar and released its study on digital dollars in January 2022. President Biden is reportedly looking to issue an executive order on cryptos, which would call upon regulators to study the national security and financial stability risks associated with digital assets.
The Digital Euro Association is partnering with Ripple.
Digital Euro Association Chairman Jonas Gross has said that the organization is partnering with Ripple, which would help “extend the technological expertise of the DEA community.” In 2021, Ripple also partnered with Digital Pound Foundation, which is an NGO researching the digital pound in the U.K.
Ripple is facing a lawsuit in the U.S.
Ripple is facing a lawsuit in the U.S. The lawsuit, which was filed by the SEC in December 2020, alleged that Ripple and its executives raised over $1.3 billion by selling XRP digital assets through an unregistered securities offering.
The EU and the U.S. risk falling behind China on digital central currencies. China is ahead of developed economies when it comes to digital payments. Digital payments in China have soared and homegrown fintech giant Ant Financial was set to have a market cap above JPMorgan Chase before Chinese authorities stalled the IPO.
The EU is warming up to the digital euro.
The EU has been warming up to the idea of the digital euro. In 2021, German Chancellor Olaf Scholz said, "We must push forward with full speed. No one will wait for us.” He added, "We must push forward with full speed. No one will wait for us.”
The E.U. is lagging behind other countries on CBDC (central bank digital currency). In 2020, ECB Chief Christine Lagarde admitted that the region has fallen behind on digital payments and can still make up with a digital euro. However, looking at the slow pace and the internal differences of constituent countries, a digital euro might not see the light of the day at least by the middle of this decade.
