According to the recently released note, the Central Bank of Spain is about to introduce the digital euro. The note explains how it is going to operate CBDC across the financial ecosystem. So, citizens should be prepared for the physical currency substitution in not only Spain but also across the entire Eurozone.
As stated by the Banco de España officials, traditional currencies can no longer exploit all the benefits of the developing digital financial environment. Society needs a more advanced solution. This is why the euro system is currently analyzing the possibility of introducing a digital euro to oppose physical cash.
According to some experts, brick-and-mortar banknotes decrease the citizens’ confidence in the monetary system's stability. Meanwhile, digital currency can guarantee access to all assets and digital currencies issued by the bank within its secure digital environment.
The main objective is to establish a comprehensive electronic environment that would eventually become a part of the European financial system. Moreover, it is necessary to ensure 100% availability and soundness. As for the CBDC, it is believed to strengthen the European financial system as an asset based on public infrastructure.
Availability appears to be one of the main concerns for consumers. However, according to the Bank of Spain, all payments can be processed without the need to have an Internet connection despite the location. Nevertheless, citizens will still have access to online payment services.
The offline mode will be introduced as a backup solution in case of network spikes and failures. What’s more, it is believed to provide an extra level of security and privacy. Besides, users will be able to review their transaction history anytime. It ensures the visibility of their financial performance. Eventually, the digital euro is supposed to become the main asset to handle basic services and transactions.
Other European banks and governments across the Eurozone follow the same move of Banco de España. Citizens should be prepared, as the potential introduction of digital money has become closer than ever.
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