Addressing a question by MEP Jonás Fernández, Draghi stated “substantial development” was nonetheless wanted within the underlying know-how behind cryptocurrencies earlier than the Central Bank would think about using them.
“The ECB and the Eurosystem currently have no plans to issue a central bank digital currency,” he summarized:
“Nonetheless, we are carefully analysing the potential consequences of issuing such a currency as a complement to cash.”
Explaining why no plans had been afoot on the ECB, Draghi drew consideration to those self same elements.
“…The technologies which could potentially be used to issue a central bank digital currency […] have not yet been thoroughly tested and require substantial further development before they could be used in a central bank context,” he instructed Fernández, including:
“With regard to the central bank administering individual accounts for households and companies, this would imply that the central bank would enter into competition for retail deposits with the banking sector and lead to potentially substantial operational costs and risks.”
He added there was at current “no concrete need” to subject a further foreign money inside the eurozone, saying demand for money banknotes “continues to grow” within the EU28.
Earlier this 12 months, a joint report from the ECB and Bank for International Settlements (BIS) highlighted “side effects” of a possible launch of such a foreign money, additionally contemplating the necessity for extra analysis beforehand.
Original article first appeared in https://cointelegraph.com/information/european-central-bank-no-plans-for-digital-currency-cash-demand-growing