The paper says there will be “further investigation” to see what features will have to be in place for the adoption of rCBDCs, including research on undesirable side effects.
The ECB said central banks may face difficult choices for rCBDCs in terms of balancing “the following three aspects: (i) keeping the current order of priority for policy goals, (ii) opting for designs and strategies that could increase the likelihood of adoption, and (iii) using designs that avoid negative economic effects.”
The study goes on to say that there’s likely going to be a “design choice problem” that will come down to how to maximize the number of desired policy goals put into place effectively, as well as avoiding negative economic effects. Banks may also have to choose between “preserving the hierarchy of policy goals” and ensuring widespread rCBDC adoption.
The ECB has recently said it wants a digital euro to have the Eurosystem acting as a middleman to validate transactions — at least at first.
Read more: SWIFT Claims Cross-Border CBDC Success; ECB Wants Settlement Control
PYMNTS wrote that ECB board member Fabio Panetta, speaking in September, said a digital euro “would mean holding a direct liability of the central bank” so the Eurosystem would be liable for mistakes — so it was important to have control.
And while EU legislators have expressed interest in a digital euro before, they’ve said they won’t be looking to Amazon to help build one. Members of the European Parliament attacked Panetta over a decision saying Amazon would contribute to a CBDC development.
“In July 2022, you were saying about the digital euro that it would protect the strategic autonomy of European payments and monetary sovereignty,” said Stéphanie Yon-Courtin, a lawmaker from French President Emmanuel Macron’s governing coalition. “You were also saying that a digital euro would help to avoid market dominance. Three months later, we’ve been announced that Amazon has been selected over 54 companies.”
