News (The Pak Global Pakistan):
(Web Desk) – The euro zone must strengthen its ability to manage payments independently, and the proposed digital euro will play a central role in building the required infrastructure for retail transactions, European Central Bank (ECB) Executive Board member Piero Cipollone said on Thursday.
Speaking remotely at a conference in Italy, Cipollone said the ECB is developing a digital version of the euro to safeguard its role in an increasingly digital economy and to protect the euro zone’s monetary sovereignty.
He explained that the digital euro project, along with two other initiatives focused on wholesale payments, will equip the euro zone with the tools it needs to ensure financial stability and autonomy. “This will help the euro zone keep its house in order and give it greater strength,” Cipollone said, when asked whether the digital euro could enhance Europe’s position compared to the United States.
According to Cipollone, the ECB expects the digital euro to be usable both online and in physical shops, as well as in offline mode. One of its main objectives is to counter the growing influence of stablecoins — digital currencies typically pegged to the US dollar.
“Stablecoins only become a threat if Europe’s payment systems fail to meet users’ needs,” he noted, adding that if all use cases are covered, there would be little reason for consumers to choose more complex alternatives.
While critics argue that the digital euro could put the ECB in direct competition with commercial banks, Cipollone rejected these concerns. He said the initiative would instead create a unified payments infrastructure that the euro zone currently lacks, while keeping banks at the core of the system.
Commercial banks will continue to manage customer relationships, provide digital wallets for holding digital euros, and retain exclusive access to users’ payment data. Payments will be carried out through mobile applications, ensuring both convenience and security, Cipollone added.