Although unconfirmed from an ECB source, Nexi CEO is bold in his assertions that his company is helping to shape ECBs approach to CBDCs.
The Italian payments company Nexi has publicly announced its work with the European Central Bank (ECB ) on a central bank digital currency, the digital euro.
To meet the demands of the people while protecting their interests, the ECB in July announced its plans for a digital euro. Rather than become an outright replacement, the central bank hopes to use the digital currency as a complement for the existing fiat currency, and payment system. This would preserve the work of financial institutions and the role of commercial lenders.
According to Nexi CEO Paolo Bertoluzzo, “We are engaging with the European Central Bank and contributing to the design of the future digital euro .” Bertoluzzo believes that the development of digital currency will help improve digital payment. He also envisages it will aid the growth of the system. He made this revelation at the Money 20/20 fintech conference in Amsterdam on Tuesday.
On the Development of Central Bank Digital Currency
Globally, there is a clamor for the adoption of digital currencies. This comes even as interest and adoption of cryptocurrency continue to rise to unprecedented levels. The result is a decline in the use of fiat across nations.
Consequently, banks globally are either researching, consulting, or actively working on or developing their CBDCs.
China is heading the charge towards a CBDC. It created the digital yuan and has tested the same on millions of citizens in several of its regions. The Bank of England and the U.S. Federal Reserve are also exploring the prospects of a digital pound and a digital dollar respectively.
Although unconfirmed from an ECB source, Nexi CEO is bold in his assertions that his company is helping to shape ECBs approach to CBDCs. Bertoluzzo said, “The situation will evolve because clearly there will be more to it. We’re starting to talk about a new version of cash. That’s the way they think about it.”
Why CBDC Is a Preferable Option for Payments
Bertoluzzo outlined the need for certainty of value for any medium of exchange. This he noted was something crypto assets lacked due to their volatility. This led him to conclude that assets like Bitcoin were not going to be very useful in facilitating cross-border payments.
“Today those types of cryptocurrencies have basically zero impact in payments,” Bertoluzzo said. In their place, Bertoluzzo notes that stable coins and CBDCs have a greater role to play in cross-border payments due to their stability.