The Italian Banking Association announced it would be ready to start work on a European central bank digital currency.
The Italian Banking Association (ABI) has revealed it would be willing to support the implementation of a digital currency from the European Central Bank.
According to a June 28 update on the ABI website, the association had approved guidelines governing its position on digital currency and central bank digital currencies (CBDCs).
The ABI—representing a group of banks in Italy—stated it was ready to “participate in projects and experiments regarding a digital currency from the European Central Bank […] to speed up the implementation of a European-level initiative.”
“Digital money needs to be fully trusted by citizens. To this end, it is essential that the highest standards of regulatory compliance, safety and supervision are adhered to,” the group stated. The ABI cited “monetary stability” and respecting regulations related to a digital euro as two of its top priorities.
Creation of a digital euro
The association stated that the creation of a European CBDC may allow for a greater number of cross-border P2P transactions, lessen the impact of the interest and exchange rates, and overall just reduce the size of the bureaucratic process for payments.
According to the ABI, developing a digital currency in the European Union (EU) could replace the demand for cryptocurrencies.
“The existence of [a European CBDC] could at the same time reduce the attractiveness of instruments of comparable use but issued by private individuals or (in cases of complete decentralization) which cannot be identified, characterized by an intrinsically higher risk profile.”
Cointelegraph reported that France became the first country to successfully trial a digital euro, operational on a blockchain, on May 20. The Dutch Central Bank said it was “ready to play a leading role” for CBDCs in the EU.
Running on distributed ledger technology
The ABI already applies distributed ledger technology (DLT) for its blockchain-powered interbanking system. The project, called Spunta, is related to Italy’s inclusion in a group of six other European nations—Malta, France, Cyprus, Portugal, Spain and Greece—who agreed to promote the use of DLT in the EU.