Are CBDCs the end of the Euro?
Visions for a restructured Euro.
The unified Eurozone was formed and came to fruition throughout the late 90’s and early 00’s. However, this was a controversial move as it removed the authority of participating member states over the currency.
Nearly two decades after the launch of the retail Euro, it remains heavily contested, with repeated calls to return to individual national currencies. While these arguments have never entirely disappeared, they also have not gained enough traction to be effective, with another seven states joining the original 12 using the Euro.
However, discussions of Central Bank Digital Currencies (CBDCs) have introduced new methods, and potentially new motivations, to leave the Eurozone. While discussions about the viability of CBDCs rage on, and are discussed further in our recent report, CBDC: Considerations for the Digital Euro, the spike in interest has also turned this into a race to market.
With the development of state-sanctioned digital currencies looming, many envision a currency that simply acts as a digital counter-part to the currency already in play. However, the Eurozone, as a diversified bloc, faces some challenges.
Estonia, for instance, an early proponent of blockchain based services, was fast to begin exploring digital…
