- Consensus 2020, a major crypto event, has kicked off virtually.
- Yves Mersch, European Central Bank’s key legal official, delivered a keynote focused on central bank digital currencies.
- He highlighted that the bank is working towards a retail implementation of CBDC.
Consensus 2020, a major cryptocurrency event, has recently kicked off digitally. The virtual conference featured European Central Bank (ECB) key legal official, Yves Mersch, as the first speaker. Mersch delivered a keynote focused on central bank digital currencies (CBDC) and revealed that they are presently working on a retail implementation of CBDC.
Comparing retail CBDCs to wholesale central bank digital money, Mersch said:
A wholesale CBDC, which is restricted to a limited group of financial counterparties, would be obviously largely business as usual. However, a retail CBDC, accessible to all, would be a game changer. So, a retail central bank digital currency is now our main focus.
It appears that the ECB is one of the first organizations to focus on retail CBDC. As per an earlier report by blockchain company R3, the current CBDC projects by global central banks represent wholesale implementation. Mersch emphasized that central banks are only focused on wholesale CBDCs due to risks of impacting the entire financial system:
You may wonder why central banks have not chosen to provide retail access to central bank money despite access to the technology so far […] The main reason is that introducing a retail CBDC could have major consequences for the whole financial system.
Despite discussing the plans of ECB to work closely on CBDC implementation, Mersch noted that the adoption would largely depend on people’s preferences. He further added that cash remains one of the most popular payment means in Europe. The bank is still focused on exploring the use cases of CBDC as a measure of preparedness, added Mersch.
If and when time comes, we want to be ready and let me assure you we will be ready.
Share
