CBDCs To Have “Major Impact” In The Eurozone

Central bank-issued digital currencies (CBDCs) will have “a major impact on the economic development of the Eurozone”, European Central Bank (ECB) board member Fabio Panetta stated. He believes that the digitalization of the Euro would largely benefit all member-states and expand into a benefit for the global monetary system.

Italy’s executive ECB board member further noted that implementing a CBDC will result in a greater domestic use of digital assets. Panetta also added that the possible areas that will benefit the Eurozone CBDC the most are financial stability, payment processing, as well as monetary policy.

“However, those areas must be carefully assessed prior to undergoing such drastic monetary overhauls. Nevertheless, if the Eurozone decides to make way of the digital Euro, it will also have an impact on global monetary policies”, Panetta stated.

The recent COVID-19 virus outbreak gave central banks around the world the much-needed time to research and develop plans for CBDCs. The ECB also formed a workgroup, assessing the aftermaths of the COVID-19 pandemic and its relation to the role of initiating a possible CBDC development.

Meanwhile, VISA’s head of crypto, Cuy Sheffield, stated that CBDCs may be one of the most important trends over the next ten years. Sheffield, who now manages VISA’s crypto-related projects, created a Twitter post, stating that “as governments still assess the situation with CBDCs, their following actions would be a key turning point for monetary sovereignty, financial inclusion and geopolitics.”

“CBDCs are among the most important trends for the future of payments and money over the course of the next ten years. Despite the controversy about whether the CBDC idea is good or bad, global interest in the technology is not fading away.” Sheffield added.

Sheffield is bullish about CBDCs and their future in domestic usage, despite stating that central banks are still not interested in digital currency solutions for consumers. Visa’s crypto division is also working on blockchain advancements, as the company filed its first digital currency patent application at the beginning of 2020.

The idea of developing a central bank-issued digital currency seems to have met proponents and supporters in central banks around the globe, as Bank of Japan announced its first research phase for its “Digital Yen” stablecoin project. For now, Japan’s plans are way behind China’s CBDC development, which allegedly entered real-world testing of its DC/EP stablecoin. However, there is still no pinned date for the much-anticipated DC/EP release.