Digital Euro Wanted by Italian Banking Association

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  • A digital Euro is looking more possible after the Italian Banking Association (IBA) said it is willing to pilot the concept
  • The IBA lists a number of ways in which a Euro stablecoin would be of benefit
  • Association of German Banks made similar comments last year

The Italian Banking Association (IBA) has claimed that a digital Euro is “capable of profoundly revolutionizing money” and has revealed that its members are willing to become involved in the European Central Bank’s (ECB) digital currency projects. The IBA, which represents over 700 banks, has listed 10 considerations that a digital Euro must adhere to, but its willingness to take part in any upcoming trials is great news for the prospect of an ECB digital currency.

“Significant Potential Added Value”

In its 10-point list of considerations, the bank clearly acknowledges the potential of a European stablecoin:

A programmable digital currency represents an innovation in the financial field capable of profoundly revolutionizing money and exchange. This is a transformation capable of bringing significant potential added value, in particular in terms of the efficiency of the operating and management processes.

They also list a number of specific benefits an ECB digital currency could bring, including transmission of value between peers, settlement of cross-border peer-to-peer transactions, interest rate mitigation, and the reduction of administrative processes.

Digital Euro Discussions Gathering Pace

Discussions on a digital Euro have gathered pace in recent months, especially since the Association of German Banks made similar calls in November last year, a month after the German Finance Minister said that a digital Euro would be “good for the financial center [of] Europe and its integration into the world financial system”.

Like some American financial commentators, European banks are wary of China taking the lead in the digital currency arena, and with China making swift progress it’s no surprise to see European banks responding, despite former president of the European Central Bank warning last year that a digital Euro could destabilize the banking system in Eurozone countries.