In line with the mandate of the European Central Bank (ECB), it has just been confirmed that the European System of Central Banks (ESCB) has a growing interest in making full use of new technology and ideas, which resulted in it analyzing and deliberating on create Euro form of digital currency. This is aimed at initiating improvement in the financial sector.
The use cases of cryptocurrency seem to be catching the attention of relevant and necessary sectors globally, and this would likely bolster its popularity has time passes. Facebook’s underway cryptocurrency, Libra, has also prompted countries like China to propose creating a digital currency that will be backed by the county’s fiat currencies.
ESCB Analyzing Crypto-assets and Stablecoins
The official letter that hinted at the proposition was addressed to Eva Kaili, a member of the European parliament, who is very passionate about the growth, widespread and adoption of cryptocurrency. Her support for digital currency in Europe has so far been noteworthy.
According to the wordings of the letter that majorly point to the subject matter, the ESCB is examining the functionality of crypto-assets and stablecoins, with the aim of having basic knowledge about “…their potential implications for monetary policy, the safety and efficiency of payments and market infrastructures, and the stability of the financial system”
Additionally, the letter averred that cryptocurrency quite has “limited implications” in Europe, but the advancement of the technology which is obvious, would cause a drastic change in the future.
It cited Facebook’s underway and under fire digital currency, Libra, and other crypto-assets, stating that all these emerging projects have the prospect of receiving mainstream adoption.
Howbeit, the letter pointed out that stablecoins’ idea for cross-border payments are clearly untested, which makes it not without certain risks and issues. These include but not limited to the risks related to financial stability and monetary policy transmission.
Conclusively, ECSB, in line with the rate of global technology advancement, showcased its interest in making a digital currency that would take Euro form, purposely for the use of all and sundry.
In this regard, Eva Kaili, the woman which the ECSB’s official letter was addressed to, also responded to the noteworthy development. She stressed her excitement via her official Twitter handle, praising the approach of ECB towards cryptocurrencies, stablecoins, and Libra especially.