European Commission to bring CBDC proposal in early 2023

As per a recent announcement, the European Commission (EC) will be proposing a bill for the CBDC (digital euro) next year.

Politico reports that at a conference on fintech this Wednesday, Mairead McGuinness, the EC finance chief, formally revealed the European Union’s formal consideration of digital euro legislation. 

The European Central Bank (ECB) is already exploring digital euro designs and technologies, with a prototype planned for late 2023. Notably, in October last year, as TheCoinRise reported, the ECB established a Digital Euro Advisory Committee to advise the Digital Euro project.

However, the Eurozone governors’ approval is necessary if a digital euro is to be introduced. If they give their approval, the digital euro may be in circulation by 2025.

McGuinness also added that legislative consultations and meetings would be held in the coming weeks. 

“Our goal is to table legislation in early 2023.”

The increased CBDC craze among regulators

Financial regulators all over the world are racing to bring their own CBDC, which is called inevitable by a Bank of America crypto strategist. The potential of a possible threat to the domestic currency from the emergence of cryptocurrency has been the biggest reason behind these serious actions.

In the area of digital currency, China maintains the first-mover advantage. However, official interest in CBDCs has risen around the world, with Kenya’s central bank recently soliciting public input on a digital shilling and Thailand already putting in place regulations for a potential retail CBDC. India is also not behind and indicated a CBDC roll-out in 2022-23.

Countless benefits

The European Central Bank (ECB) published a report on digital currencies last year. The research discovered that a digital euro might help in reducing interest rates, speeding up transaction processes, and reducing cash usage.

Regardless of the perceived benefits, central bankers struggle mightily in winning public support. In a research undertaken by the UK Economic Affairs Committee and Germany’s central bank, the majority of respondents oppose government-backed digital currencies, citing skepticism about benefits and concerns of government control and surveillance.