ECB’s Panetta Says CBDCs ‘Likely’ to Be Legal Tender: Report

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Central bank digital currencies (CBDCs) will probably become legal tender in the jurisdictions of their issuance, the European Central Bank’s (ECB) Fabio Panetta stated.

  • Panetta, a member of the ECB’s government board, stated this was “likely” at a panel in Helsinki on Tuesday, in accordance to a Bloomberg report. However, this standing “should not be taken for granted,” he added.
  • CBDCs being authorized tender would give them an edge over different fee choices supplied by personal corporations and assist obtain wider use by the general public.
  • “It would be quite awkward not to have legal-tender status for an additional instrument issued by a central bank,” Panetta stated.
  • A doc revealed at the moment outlining the ECB’s policy considerations for introducing a digital euro lists the opportunity of authorized tender standing as certainly one of its principal areas for investigation.
  • Other issues embody interplay with the European retail funds market, design decisions, use circumstances and what entrance and back-end technical infrastructure may finest deal with these points.
  • The ECB has been discussing a CBDC because the begin of the 12 months and stated in July it was commencing an investigative part that will final 24 months.

Read extra: Digital Euro Isn’t Guaranteed After Experiment, ECB Advisor Says