The ECB is considering issuing a digital euro

Every day we use more electronic money transfers (Covid-19 has driven it even more), and many central banks are thinking about launching digital versions of their currencies. And one of them is the European Central Bank.

From the moment they start to think about this proposition until they get to do it (if they get there) a few years will have passed, because they are decisions that have a very deep social depth and with money issues we can’t play.

In China they have already launched a digital currency and are “testing” it in a few cities, and banks such as France, Japan, etc … are studying it. It is not something that will happen from one day to the next, but it tells us where the trends of the future are going.

It will be easier to make economic exchanges and we will do so from our digital devices, especially smart-phones and other devices for personal use (smart-watches, or similar).

The appearance of bitcoin revolutionized the market for economic transactions and has had many other followers, but its main “weakness” is that its value varies with demand, so in my opinion they are speculative currencies, and therefore risky.

“Official” currencies such as the euro have their value controlled by a Central Bank that provides us with certain guarantees of the value of the currency itself, and they do not suffer from the ups and downs of cryptocurrencies.

The digital euro would be “guaranteed” by the ECB.

It remains to be seen who and how they have that digital money, because if we have it in a “digital wallet”, that would mean that it would not be in the bank and could represent a significant economic decline for them. So the banks would be weaker.

Everything seems to indicate that the ECB would limit the number of digital euros that each person could have, in order to limit risks, and especially money laundering.

This is an issue to know about but not to be a cause of worry, because as I said before we are still a few years away from it being a reality, but I am quite clear that it will end up becoming a reality.

It is the sign of the times.