There is a limit of digital Euros one can have in his wallet. So you need to either stay that low, have many wallets which you probably wont be able to have or connect the wallet with a bank account. It is therefor good for European banks as it gives them an advantage over Visa/Mastercard: the cost.
If the digital Euro wallet would be unlimited in size there is no need for banks any longer.
It’s too good of an idea, so the EU will fuck it up like they always do. A stable coin with central bank warranty… would be nice. No more coins needed.
There’s a lot of potential issues with narrow banking (which is what you describe, where banks are disintermediated). The system would have to be very different if we still want to lend money to people and business (which we do want to, as it allows for a more productive economy), maybe there’s a system that would work but it’s a lot of risks and unknowns (and most countries might not want to experiment with it and be the ones learning the lessons and going through the potential crisis while trying to make a totally different financial system work )
It’s the same for India. UPI is gaining share rapidly against Visa & Mastercard. Lot of pressure from US to get the level playing field. Whatever it means.
I think US should try to focus on providing low cost high tech solutions rather than try to force them. It’s not going to get anywhere.
Digital Euro is something EU should pursue irrespective of lobbying, pressure etc. Its ridiculous/naive to route financial transactions via US companies.
Good thing is that tokenization & Digital Euro are coming at same time. Maybe it is a good timing
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