The European Central Bank (ECB) is planning to accelerate efforts to state its objectives on why it should develop a Central Bank Digital Currency (CBDC) before it subsequently moves on with the technicalities.
According to a Reuters report today, the ECB’s president, Christine Lagarde, while presiding over her first meeting at the bank’s monthly monetary policy decision, noted that the bank needs to identify the objectives of the project before the end of Q2 2020.
“Are we trying to reduce costs? Are we trying to cut out the middleman? Are we trying to have inclusive finance at no cost? There is a whole range of objectives that can be pursued,” she added.
Lagarde, who was the former International Monetary Fund (IMF) boss and took over the helms of affair of the ECB on November 1, 2019, stated that several nations, including Canada and England, have carried out similar projects to understand the pros and cons of issuing a CBDC.
She further noted that the ECB needs to act fast so that it can be “ahead of the curve” with digital currency, thus it is essential that the bank clearly define its objectives for the project.
“[…] We would better be ahead of the curve because there is demand out there that we have to respond to,” she said in the report.
According to reports, the ECB is deliberating on issuing its digital currency, with some members strongly emphasizing on the pros of developing one.
On the other hand, other members of the bank believe the creation of a state-backed digital currency could have an adverse effect on the continent’s financial system.
Even though the ECB is focused on developing a CBDC at the moment, the bank never seemed to be a supporter of cryptocurrencies when President Jean-Claude Trichet was calling the shots at the bank.
As reported, Trichet publicly made known his opinion about crypto, especially Bitcoin, stating that he is against the popular cryptocurrency and he does not believe cryptocurrencies would become the future of money.
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