A panel of euro-zone central bank officials will soon reveal their verdict on whether or not the region needs to create a digital version of its currency, according to European Central Bank President Christine Lagarde.
Such an initiative may be critical to ensure the bloc isn’t left behind in the move to digital currencies and global changes in payments, she said in a virtual event with Germany’s Bundesbank Thursday evening. New technology could improve the efficiency of financial transactions and put Europe at the edge of innovation, but it can also bear risks.
“The Eurosystem has so far not made a decision on whether to introduce a digital euro. But, like many other central banks around the world, we are exploring the benefits, risks and operational challenges of doing so,” Lagarde said. “The findings of a Eurosystem task force are expected to be presented to the public in the coming weeks, followed by the launch of a public consultation.”
The ECB president added that while it’s not necessarily a concern that Europe is dominated by foreign payment service providers, the “evolving global context” and “increase in protectionist policies” presents new risks of disruptions to transactions.
“We have a responsibility to ensure that our citizens have choice and cannot be excluded from the payments ecosystem due to the unilateral actions of others,” she said.
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