Digital Euro to Ensure EU Monetary Sovereignty
Seeking to ensure its monetary sovereignty, the EU appointed Stefan Berger to lead the development of legislation for its digital euro.
- The EU displays a mix of excitement and apprehension toward the CBDC.
- Berger believes that a digital euro could enhance the EU’s global presence and boost independence.
On August 30th, the EU appointed Center-right German lawmaker Stefan Berger to spearhead the development of legislation for its digital euro to ensure its monetary sovereignty, sparking curiosity and skepticism within its parliament.
Having successfully negotiated the Markets in Crypto Assets (MiCA) law, Berger is now taking on a similar endeavor with the digital euro. Considering MiCA focused on maintaining financial stability and protecting investors while promoting more widespread transformation in the crypto asset sector in the EU, he is uniquely qualified to shape the EU’s digital currency landscape.
The Union has been simultaneously excited and apprehensive when it comes to central bank digital currency (CBDC). While the European Central Bank (ECB) has yet to make a definitive decision on CBDC implementation, significant resources have been invested in its technical planning.
The EU sees potential in CBDC as it complements cash and deposits, supports the digitalization of the EU economy, and strengthens the international role of the euro, among other things.
Establishing the CBDC legal framework requires a collaboration between the European Parliament and the EU’s national governments, with data protection being a critical facet. Analysts also expect the political climate within the Parliament to influence the ECB’s decision.
For his part, Berger hasn’t been shy in his advocacy for cryptocurrency, strongly believing that the EU’s digital currency bolsters its presence on the world stage.
In a post on X, he wrote: “Having your own digital currency makes the EU more independent of non-EU countries and is part of the digital age.” He goes on to clarify, “The project will only succeed if you can trust the digital euro just as much as you can trust cash.”
Berger is tasked with introducing amendments to the legislation, which are subject to modification and voting by fellow lawmakers. As such, he will lead negotiations with the Council to converge on a cohesive text.
Some members of Parliament are questioning the digital euro’s practical benefits. Concerns range from potential consumer confusion to the erosion of financial system confidence. Still, dedicated lawmakers are committed to addressing them and refining the legislation to align with citizens’ needs.
On a wider scale, the CBDC pursuit furthers the EU’s plan for economic stability and monetary sovereignty. Considering the world climate, a CDBC could make domestic and international payments easier thus offering economically struggling countries an economic boost. It also could facilitate cross-border trade and reduce costs of remittances—payments sent by immigrants to their families in their home countries.
Inside Telecom provides you with an extensive list of content covering all aspects of the tech industry. Keep an eye on our Fintech sections to stay informed and up-to-date with our daily articles.