GEAB 139

We have been anticipating the arrival of central bank digital currencies (CBDCs) for a year.[1] And it was Christine Lagarde’s speeches at the IMF last November, in particular, that encouraged us to do so. Inevitably, Christine Lagarde’s appointment as head of the ECB indicates that this type of agenda is likely to be accelerated in the eurozone. And, indeed, evidence is mounting up: Benoît Coeuré, another important figure in the debate on the strengthening and internationalisation of the euro,[2] whose term of office on the ECB’s Executive Board ends in December, has joined the all-powerful central bank of all central banks, the BIS (Bank for International Settlements, based in Basel)… on a “digital currency initiative” portfolio, to be precise,[3] with a mission to find the answer to Facebook’s libra.[4]

But that’s not all: the Germans are now chiming in with the French with a statement from the Association of German Banks (representing more than 200 banking institutions) calling for the launch of a digital euro based on the blockchain (crypto-euro)![5] A few days after this announcement, Thomas Mayer, an economist at the Goethe University in Frankfurt, published an article entitled A digital euro to save the European Monetary Union.[6] Coming from the most central and conservative of the players involved in our common currency, this kind of signal is to be taken seriously. It should also be noted that the introduction of instant transfers initiated by the ECB since mid-2018 is very similar to this digitalisation of the euro.[7]

Not far from the eurozone, the Bank of England’s Mark Carney keeps claiming that the dollar must be urgently replaced in international trade/reserves by a digital currency based on a basket of currencies[8] –  something GEAB/LEAP requested from the G20 members in London in 2009 via the purchase of a full page ad in the international edition of the Financial Times.[9] Interestingly, he has recently shown less opposition to the libra than his colleagues,[10] probably because he sees it as the most relevant model, to date, for a global currency and catalyst for transformation.