The European Central Bank (ECB) will launch its own cryptocurrency if the private sector fails to create an efficient solution for cross-border payments, and if cash usage drops.
Europe currently has an ECB-backed project for real-time payments, known as TIPS. This has however been met with caution by commercial banks.
The document states that “signs of a future decline in cash usage could be a catalyst in accelerating central bank efforts in the area of central bank digital currency.” The ECB has been focusing more on digital currencies after social media giant Facebook announced it’s looking to launch its own cryptocurrency, Libra.
The document which is set to be discussed by EU finance ministers, reads:
If industry efforts fall short of developing an innovative and efficient pan-European payment solution, the social need for it could potentially be met by issuing a central bank digital currency.
It states that an ECB-backed digital currency could have “far-reaching implications” for the financial system