From Norbert Häring and current issue of RWER On 2 October, the European Central Bank (ECB) announced in a press release that it intends to intensify its work on a digital euro. The ECB enumerated three scenarios under which it might want to issue a digital euro: (i) a sharp decline in the use of cash, (ii) “he launch of global private means of payment that might raise regulatory concerns and pose risks for financial stability and consumer protection” (read: Libra), and (iii) a broad take-up of central bank digital currencies (CBDC) issued by foreign central banks (read: digital yuan). With a digital euro one could, if one wanted and was allowed to, actually do some good, namely: create a supplement for cash that protects privacy better than other digital means of payment, give
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from Norbert Häring and current issue of RWER
On 2 October, the European Central Bank (ECB) announced in a press release that it intends to intensify its work on a digital euro. The ECB enumerated three scenarios under which it might want to issue a digital euro: (i) a sharp decline in the use of cash, (ii) “he launch of global private means of payment that might raise regulatory concerns and pose risks for financial stability and consumer protection” (read: Libra), and (iii) a broad take-up of central bank digital currencies (CBDC) issued by foreign central banks (read: digital yuan).
With a digital euro one could, if one wanted and was allowed to, actually do some good, namely:
- create a supplement for cash that protects privacy better than other digital means of payment,
- give citizens and companies an alternative to bank money which always carries the risk of bankruptcy,
- curtail the power of banks, by taking away or limiting their power to create money,
- help prevent a private company such as Facebook, with its own globally accepted currency, from crowding out the euro in payment transactions,
- prevent China from using its digital yuan to replace the euro (or the dollar) as a transaction currency.
On the other hand, however, it is also possible to do rather underhanded things with it, especially:
- facilitate and accelerate the abolition of cash in order to perfect financial control over citizens,
- defend and expand the sanctioning power of the U.S. government, with which it enforces its own law worldwide, including in Europe, in violation of international law.
I will briefly explain what a digital euro is and how it works. Then I will deal with the all-important questions of who controls it and to what end. read more