{"id":30459,"date":"2020-10-21T16:58:46","date_gmt":"2020-10-21T13:58:46","guid":{"rendered":"https:\/\/forklog.com\/en\/?p=30459"},"modified":"2025-08-27T22:24:12","modified_gmt":"2025-08-27T19:24:12","slug":"bundesbank-warns-of-risks-posed-by-digital-euro-to-the-financial-system","status":"publish","type":"post","link":"https:\/\/forklog.com\/en\/bundesbank-warns-of-risks-posed-by-digital-euro-to-the-financial-system\/","title":{"rendered":"Bundesbank warns of risks posed by digital euro to the financial system"},"content":{"rendered":"<p>Member of the Executive Board of the German Bundesbank Burkhard Balz <a href=\\\"https:\/\/www.bis.org\/review\/r201020g.htm\\\" target=\\\"_blank\\\" rel=\\\"nofollow noopener noreferrer\\\">believes<\/a> that the introduction of the digital euro could have sweeping consequences for the entire financial system.<\/p>\n<p><!--more--><\/p>\n<p>If a central bank digital currency (CBDC) were to acquire characteristics similar to traditional money, in a crisis depositors would mass-convert their funds into it.<\/p>\n<blockquote>\n<p>&#8220;This could lead to destabilisation of the banking sector and, as a consequence, potentially weaken lending to the economy,&#8221; Balz said.<\/p>\n<\/blockquote>\n<p>In his view, the solution would be to limit the amount of digital euros a single user could hold. This would allow regulators to control demand for the asset and use it solely as a means of payment.<\/p>\n<blockquote>\n<p>&#8220;A comprehensive analysis and evaluation of state cryptocurrencies, comparison with alternative options. The impact of the digital currency on society at large needs to be assessed,&#8221; Balz emphasised.<\/p>\n<\/blockquote>\n<p>He added that the Bundesbank is involved in discussions around CBDC, but seeks solutions that would prevent this step.<\/p>\n<p>In 2019, Jens Weidmann, president of the Bundesbank, warned with similar cautions. In his view, high demand for cryptocurrencies could negatively affect the regulator&#8217;s balance sheet.<\/p>\n<p>As reported, on 12 October the European Central Bank (ECB) <a href=\"https:\/\/forklog.com\/en\/news\/ecb-steps-up-work-on-digital-euro\">opened<\/a> public discussion of the advantages and problems associated with issuing a digital currency.<\/p>\n<p>Earlier, ECB President Christine Lagarde <a href=\"https:\/\/forklog.com\/en\/news\/ecb-chief-digital-euro-will-not-replace-cash\">stated<\/a> that CBDC will be a complement to cash.<\/p>\n<p>Subscribe to ForkLog news on <a href=\\\"https:\/\/www.facebook.com\/forklog\\\" target=\\\"_blank\\\" rel=\\\"nofollow noopener noreferrer\\\">Facebook<\/a>!<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Member of the Executive Board of the German Bundesbank Burkhard Balz believes that the introduction of the digital euro could have sweeping consequences for the entire financial system.<\/p>\n","protected":false},"author":1,"featured_media":30460,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"select":"1","news_style_id":"","cryptorium_level":"","_short_excerpt_text":"","creation_source":"","_metatest_mainpost_news_update":false,"footnotes":""},"categories":[3],"tags":[1989,1095,109],"class_list":["post-30459","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news-and-analysis","tag-bundesbank","tag-cbdc","tag-germany"],"aioseo_notices":[],"amp_enabled":true,"views":"24","promo_type":"1","layout_type":"","short_excerpt":"","is_update":"","_links":{"self":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/30459","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/comments?post=30459"}],"version-history":[{"count":1,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/30459\/revisions"}],"predecessor-version":[{"id":30461,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/30459\/revisions\/30461"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/media\/30460"}],"wp:attachment":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/media?parent=30459"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/categories?post=30459"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/tags?post=30459"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}