The digital euro, the end of physical money?

Digital money has come to stay, although for many it is a big unknown. Could this be the end of physical money as we know it?

We are becoming more and more accustomed to paying by electronic means, because it is easy, convenient, and you do not need to carry cash on you. We have already heard about cryptocurrencies, bitcoins, and cryptocurrencies. For this reason, Europe does not want to be left behind and will create its own digital currency, as countries such as China, Sweden, and Uruguay have already done.

According to the European Central Bank (ECB), this digital currency could come to life 4 to 5 years from now.

The digital euro is what we know as an electronic currency managed and supervised by the ECB that can be used by both citizens and businesses to pay, and will not in any way replace cash, but will complement it. It is what is known as a digital currency issued by a central bank, that is, a CBDC (Central Bank Digital Currency).

What is clear is that the digital euro will not be a cryptocurrency or a crypto asset, says the ECB, as it has the support of the Eurozone and will remain the currency of all member states.

  • When can we use it?

No release date has been set yet. All we know is that it will possibly be operational in about 4 or 5 years. In any case, creating a type of currency like this, digital, secure, accessible, and efficient takes time. The ECB recently conducted a public survey of the population to see what the interest was on the need to create this digital currency, which indicated that there is a real need and demand.

  • What are its advantages?

It would be an alternative to cash in extreme situations, such as catastrophes, in which cash cannot be used and in which traditional means of payment, such as POS, do not work. It would allow you to make safer and faster payments without intermediaries. It would also promote financial innovation as well as the inclusion of developing countries in the world of finance, which is now difficult for them.

  • What is the difference between digital euro and cryptocurrencies?

Cryptocurrencies are not Central Bank money, so the main difference is that cryptocurrency prices are volatile and are backed by companies or private investors.
With the launch of the digital euro, the ECB would shield the euro and allow citizens to use this form of payment securely. But not all is good news. Using the digital euro takes away the privacy we now have with physical money.

  • The competitors of the digital euro

A good number of Central Banks are working on the development of digital currencies, but some countries are much more advanced than others. We can highlight three: firstly, China, whose digital currency (called eYuan) launch date, is unknown, but tests are being carried out on the operation of this currency in retail transactions; secondly, e-Krona, which is Sweden’s cryptocurrency and has already begun testing by the Central Bank. And finally the e-Peso, which was tested in 2017 in order to analyse its suitability.

According to Christine Lagarde, director of the European Central Bank, the digital euro is a means of payment under study that could be tested in 2021, although its operational launch will still be long in coming. In any case, the advent of digital currency would be a real revolution in the economy as we know it.

Equip Editorial
  1. Meritxell Cornudella says:

    M’inicio al tema del diner digital. Va bé llegir, gràcies.

  2. alicia Coiduras Charles says:

    Será un bon que l’euro digital, ja que poder assegura més estabilitat que les criptomonedes

    • Aitor Canudas says:

      Segurament Alicia. Per altra banda, pensa que les criptomonedes no estan regulades

      2 weeks ago
  3. Carme Dalmau Planas says:

    No sé si és cert, pero vaig llegir ja fa alguns mesos ,que a Suissa ,moltes empreses paguen entre elles ,en monedes virtuals que ells mateixos s,han inventat. De tota manera la vostra expicació m,ha interessat. Gràcies.

    • Albert Chic Giménez says:

      Com a curiositat, Carme, tinc entès que el cantó suís de Zug accepta, des del febrer d’enguany, el pagament d’impostos amb bitcoin, fins a un import de 100.000 CHF.

      2 weeks ago
    • Marifé Fariñas says:

      Gràcies per la teva aportació, Carme! Salutacions!

      1 month ago
  4. Joan Bringues says:
    • David López says:

      Gràcies Joan, desitjo que t’hagi agradat aquest article. Recorda que tens molts més a la secció Magazine. Una salutació i ens veiem a la Plaça.

      3 months ago
  5. Joan Jou i Buch says:

    No és certa l’afirmació que totes les criptomonedes siguin volàtils, hi han moltes StableCoins, monedes referenciades a una moneda fiat, sobre les que s’està edificant tot un nou model econòmic.

    • Jordi Coll Planas says:

      Si, Joan, és veritat el que dius…, però tot essent així, això no està garantit al cent per cent… M’imagino que és aquesta la interpretació que li volia donar el redactor de l’article… Ningú sap exactament que passaria amb les criptomonedes si hi hagués un daltabaix com el que va succeir l’any 2.007 amb les hipoteques brossa als EEUU, salvant les diferències, clar…

      3 months ago
    • laura bunyol says:

      Que interessant. Bon matís

      3 months ago

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