Digital euro will not replace cash, says ECB
A digital euro will support, not replace, physical money in the eurozone, says ECB board member Piero Cipollone.
Cash will stay central to the eurozone’s financial system, the ECB confirmed, as work on the digital euro moves forward. A board member Piero Cipollone said euro banknotes and coins will be supplemented, not replaced, by a digital version to protect payment autonomy in Europe.
The ECB’s commitment follows a surge in the use of private digital currencies and stablecoins, which are increasingly used for daily transactions and international transfers. They see the digital euro as a secure answer to the rising influence of foreign stablecoins, especially US dollar-backed ones.
Despite the digital push, Cipollone stressed cash is vital, especially in crises when digital systems might fail. The ECB wants Europeans to have access to physical cash and digital euros alike, all with legal tender status and full usability.
Meanwhile, the ECB has acknowledged lukewarm interest from the public. A March study revealed Europeans were reluctant to allocate significant funds to a digital euro.
Separately, ECB adviser Jürgen Schaaf warned that Europe must implement unified regulation to avoid dominance by US dollar-backed stablecoins and preserve monetary sovereignty.
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