In a speech, the ECB’s Fabio Panetta argues that a digital Euro is necessary because
[i]n the digital age … banknotes could lose their role as a reference value in payments, undermining the integrity of the monetary system. Central banks must therefore consider how to ensure that their money can remain a payments anchor in a digital world.
He argues that
outsourcing the provision of central bank money [to stable coin providers] … would endanger monetary sovereignty [as would the absence of a national digital currency].
Panetta also argues that a digital Euro could
- improve the confidentiality of digital payments and
- increase choice and reduce costs
- avoid interfering with the functioning of the financial system and
- be available within private payment solutions.
Panetta does not discuss
- seignorage and
- time consistency motivations.