The European push for a CBDC [Central Bank Digital Currency] will begin in Berlin. After weeks of beating around the bush, a clear call for a digital Euro has come from a consortium of over 200 German banks.
On 30 October, the Banken Verband, or the Association of German Banks, comprising of notable banking and financial institutions like Deutsche Bank, Credit Suisse, Bernberg, and Commerzbank, released a report that could not be more clear about the “need” for a digital centralized currency. The report was titled, “German banks say: The economy needs a programmable digital Euro.”
The report called this digital payments race ushered by Facebook with their Libra project, the “Fourth Industrial Revolution,” adding that it can pose a “structural change in the global economy.” The aim of the paper, the Banken Verband said,
“This makes it all the more important to achieve a social consensus on how programmable digital money can be integrated into the existing financial system.”
Based on the above premise and the known competitors in this space, both public and private, the report expanded on their structure to the digital Euro project. Tying it together with individual country’s monetary systems as well as the bloc’s, the paper presented how the CBDC would work with private and central banks.
The Association stated that if a “global crypto-asset” is to be launched, it must be from a single or a consortium of central banks. Facebook’s push with Libra, a “private global digital currency” backed by a basket of five fiat currencies, would only “exacerbate economic conflict,” according to the report.
“Massive inflows and outflows of capital could, for example, seriously upset a country’s economic equilibrium. Corrective tools used so far, such as exchange rate or interest rate adjustments,