The European Union estimates to launch its digital currency in 2025

The European Commission continues to work on the development of the digital euro and they estimate to finalize a first prototype of their digital currency by the end of this year. But the commission plans to launch it on the market, regulated and official, by 2025 when it will compete with the Chinese cryptocurrency and the one that the United States is developing.

The countries of the world are working and joining efforts to work on a digital version of their fiat currencies. Thus, it is estimated that the dollar, the yuan and the euro will have their digital version.

The popularity of cryptocurrencies and the growing interest from traditional banks and institutions have set off alarm in central banks, which have been working for some time to create these digital versions of their own currencies.

Public and regulated digital currencies

The Eurozone is very clear about the importance of having a digital euro and the European Central Bank is immersed in this effort, which is why it is carrying out internal tests to finalize the project.

The director of the European Central Bank (ECB), Christine Lagarde, announced last July 2021 that approximately 80 central banks were interested in the creation of cryptocurrencies and one of them was the ECB, which initiated the conceptualization of the project in October of last year.

Currently, the European Commission is preparing the legislation that will regulate the digital euro and those responsible estimate that it will be completed by the beginning of 2023. At this time, the planning carried out seems to be very good because during the legislative process of the European Union, “the negotiations with the Member States and also in the European Parliament before finally becoming law”.

Some representatives of the ECB explained that the digital euro “would complement cash, it does not come to replace it”. But it would also become a solution to the attractiveness of cryptocurrencies such as Bitcoin or Ethereum which, despite not being used as currencies for buying and selling everyday goods and services already have derivative or alternative cryptocurrencies that are positioning themselves in that market segment.

Public consultation for the digital euro

The European Union plans to carry out a public consultation process, within a few weeks, in order to reaffirm the use that European citizens will give to the digital euro, as recently reported by the EU’s financial director, Mairead McGuinness, at an event about FinTech.

Once the public consultation has been carried out, it is planned to carry out an assessment on the impact that the digital euro could have on a potential destabilization of the financial system, since it could affect the liquidity of private banks if people convert all their money into the currency regulated and managed by the ECB.

M. Rodríguez

Source: xataka.com