After the European Central Bank (ECB) completed the consultation stage on the development of the digital euro, from today it enters the research phase of the project for 24 months.
This assertion is derived from a statement that the financial institution published on its web portal on July 14, 2021. According to the press release, this period will serve to address the issue of a design based on the preferences of both users as of the merchants and intermediaries.
The decision was made during the Governing Council of the European Central Bank where the head of the institution intervened, Christine Lagarde, who commented more broadly on the following:
A digital euro must be able to meet the needs of Europeans and, at the same time, help prevent illicit activities and avoid any undesirable impacts on financial stability and monetary policy. In any case, digital euro would complement cash, not replace it.
Christine Lagarde, President of the European Central Bank.
The executive clarified that the objective of this work is to guarantee that, during the digital age, both citizens and businesses continue to have access to the safest form of money which, in his opinion, is the one issued by central banks
This research stage will benefit from the test work carried out by the ECB and the national central banks of the Euro Zone. Source: Wikipedia.
ECB evaluated the impact of the euro on the market
According to the press release, another important aspect that will be addressed during this process is to analyze the effect that the digital euro will have on the market. Design alternatives will be considered to, in this way, certify privacy and prevent risks for citizens and intermediaries who make their lives in the Euro Zone, as well as in the local economy.
The publication makes a full stop on intermediaries (financial sector), pointing out that for they will design a business model. A market advisory corporation will also be in charge of taking into account the opinions issued by both users and distributors on the feasibility of a digital euro.
The statement explains that this investigation stage, which will last two more years, will be nourished by the test work carried out by the ECB and the national central banks of the Euro Zone for the past nine months. Representatives from the academic and private sectors participated in them.
During this period, tests were carried out in the following four areas: the digital ledger in euros; privacy and fight against money laundering; limits of the digital euro in circulation; and end user access while not connected to the internet along with the inclusion of appropriate devices. The ECB concluded, during this trial, that ‘no major technical barriers were identified for any of the evaluated design options’.
ECB questions bitcoin’s alleged high energy consumption
Lastly, this post from the European Central Bank lashes out at bitcoin (BTC) for the opinion matrix that has been created around its high energy consumption. Specifically, it says the following:
According to these experiments, a central digital euro infrastructure would be environmentally friendly: for the architectures that were tested, the energy used to execute tens of thousands of transactions per second is negligible compared to the energy consumption of crypto assets such as bitcoin.
European Central Bank.
The ECB publication seems to ignore the report recently published by the University of Cambridge, United States. This document, reviewed by CriptoNoticias assured, at the beginning of July 2021, that the electricity consumption of bitcoin was reduced by 60% in less than two months, reaching October 2020 levels.
The investigation showed on that occasion that bitcoin reached 67 terawatt-hours (TWh), while last May it consumed 141 TWh, the highest electricity consumption in the history of the most popular cryptocurrency in the ecosystem.