ECB President: Brussels readies law for digital euro
A revolution on the digital currency market in the European Union
The President of the European Central Bank (ECB) - Christine Lagarde recently announced that the European Commission will soon present a proposal to introduce a digital euro in the European Union. The second step is to define the legal status of this asset by European regulators.
Christine Lagarde mentioned the need for a digital euro
- I look forward to the legislative proposal to establish a digital euro, which will be proposed by the European Commission in the near future - comments the President of the ECB.
A key participant in the legislative process of the European Union, along with the European Parliament and the EU Council, is the executive body in Brussels. This entity is largely responsible for proposing and issuing legal opinions related to draft laws. Lagarde in his speech emphasizes that the authorities cooperating in the creation of the new legal framework should focus on maintaining the public goals of the new laws on the digital euro. The head of the European Central Bank pointed out two important aspects here - privacy and the legal tender status of the digital euro.
As we learn from a recent survey, as many as 43% of the respondents participating in the public consultation on the digital euro declared that they perceive privacy as the most important feature of the upcoming changes.
- We should ensure at least a level of privacy equal to the current electronic payment solutions - points out Christine Lagarde - while excluding full anonymity such as cash transactions. It is highly advisable to invoke anti-money laundering legislation in this regard and the need to limit the use of the digital euro for investment. However, Lagarde has not ruled out greater privacy for low-value, low-risk, and offline transactions.
Moreover, Lagarde raised a very important topic, namely that it is a constitutionally established feature of cash that it should be legal tender. As the French president of the ECB explained, the same rule should apply to the digital version of the euro. This would be to enable European Union citizens to use this type of asset to make payments anywhere. This should include digital payments in regular stores, e-commerce and peer-to-peer payments, concluded the head of the ECB.
The head of the ECB speaks about cryptocurrencies
During her speech, Christine Lagarde also referred to the recently voted legislation on cryptocurrency markets, i.e. MiCA. The president of the European Central Bank also pointed out that the emergence of cryptocurrencies such as Bitcoin and Ethereum is a major factor that could lead to a potentially destructive transformation of the traditional payment model.
Interestingly, the aforementioned act contains a provision that may have a key impact on many projects related to digital assets in the European Union. The point here is that people widely known in the virtual currency industry who have a large impact on the crypto sector should be careful. EU lawmakers point out that it often happens that such people promote cryptocurrency assets on social media without disclosing the fact that they have a connection with them, and also benefit financially from these activities. The head of the ECB said that such behavior could be classified as market manipulation.
