If a digital euro is launched, its issuance would be capped at €1.5 trillion. This was stated by Fabio Panetta, a member of the Executive Board of the European Central Bank (ECB).
According to him, EU authorities fear that consumers could move all their money into a digital format, effectively transferring it to the central bank. This would deprive commercial banks of funds needed to lend to individuals and businesses.
A capped issuance of the digital euro would help avoid negative consequences for the financial system and EU monetary policy.
“There are about 340 million people living in the euro area today; this would allow holding 3,000 to 4,000 digital euros per person,” Panetta said.
He added that the consultations conducted by the European Commission in 2021 among citizens did not show much enthusiasm for the digital euro. Partly this is explained by the “complexity” of the technology for the average user.
Nevertheless, Panetta urged not to attach too much weight to these findings, as “the consultation was not based on a representative sample of citizens.”
Back in November 2019, the initiative to issue a digital euro originated. In October 2020 the ECB published a comprehensive report on the topic.
In May 2022, Fabio Panetta allowed the issuance of the digital euro by 2026.
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