At a meeting on Wednesday 14 February with members of the European Parliament’s Committee on Political and Monetary Affairs (ECON), Piero Cipollone, member of the Executive Board of the European Central Bank (ECB), outlined the state of play of the ECB’s technical work as part of the preparation phase (see EUROPE 13274/29) for the digital euro project. They consist of four central questions.
Identifying possible suppliers to develop a platform for the digital euro and its infrastructure. Piero Cipollone indicated that the process of selecting potential suppliers had begun (see EUROPE 13320/16), but stressed that the ECB had not launched the development processes. He stressed that the main aim was to establish framework agreements that could be activated if the digital euro was launched.
To ensure that the digital euro is based on a European infrastructure, only legal entities registered in the EU and controlled by European nationals can take part in the calls.
Mr Cipollone said that, unlike the last calls, the call for test exercises, won by Amazon, had been open to all, but that few companies had applied.
Applicable regime. Mr Cipollone announced that work was progressing on finalising a rulebook for the digital euro.
Financial stability. He went on to stress that the potential introduction of a European Central Bank digital currency should not undermine the objective of monetary policy transmission or financial stability.
He stressed that safeguards had been built into the design of the digital euro project. These safeguards include, firstly, the non-remuneration of digital euros held in wallets, which would therefore not compete with bank deposits. The ECB is also keen to set limits on the number of euros held by individuals. Businesses and public sector bodies will be able to receive and process payments in digital euros, but will not be able to retain any sums in digital euros.
Finally, Piero Cipollone pointed out that the ECB had just begun to develop the analytical framework and models that will be used to help determine the holding limit.
Respect for privacy. A point that Piero Cipollone considers to be of the utmost importance: he stressed that the euro in its physical form would continue to be distributed. He also stressed that the digital euro would be accompanied by an offline mode of use. He also pointed out that the Eurosystem would not be able to identify individuals on the basis of the payments they make. Finally, Mr Cipollone assures us that the Eurosystem will implement state-of-the-art protection measures.
Mr Cipollone also felt that the Commission’s provision (see EUROPE 13211/11) to limit the costs of the digital euro from the outset and protect retailers was reasonable. The ECB can make technical proposals, but will not decide on thresholds. (Original version in French by Émilie Vanderhulst)