Brussels (Brussels Morning Newspaper) – The European Central Bank is demanding urgent action on creating a digital euro, cautioning that the slow progress of a legislative process could leave Europe behind in the race to devise central bank digital currencies (CBDCs).
ECB’s digital euro project director, Evelien Witlox, urged faster progress as major players such as the UK and China are actively debating their digital currencies. Witlox said that it is necessary for Europe to speed up as it doesn’t want to fall behind these competitors.
There was no EU-wide digital payment solution, and 13 of the 20 nations that comprise the eurozone did not have a national card system. These nations, however, are dependent upon Visa and Mastercard rather than banks. The European market remains dispersed, stated Witlox, with only non-European entities contending with solutions for much of the continent. To close the holes, the ECB undertook a CBDC exploration project in October 2021.
What is delaying the digital euro’s legislative progress?
The project has been postponed as the legislation process continues. The European Parliament and the Council of the European Union have to meet a legal framework for the digital euro to witness the light of day. Almost 17 months after the European Commission first proposed the digital euro, this step has not been taken.
These delays upset Witlox, who said they could make Europe less able to eventually develop the digital euro in a timely fashion. She emphasises that the digital euro must be prepared “at the right pace”, and for the right causes. Witlox is optimistic that Europe will retain its place in the global field of CBDCs. While there isn’t a detailed timeline for when the digital euro will launch, she stressed that while Europe is a leader in the CBDC space, its continuous work will keep it at the forefront of innovation in the space.
