ECB’s Rehn sees multiple benefits to possible digital Euro

HELSINKI – on Aug 24, Olli Rehn, who is a policymaker at Finland and the European Central Bank (ECB), said on Tuesday that a possible digital Euro currency being studied by the ECB could have multiple benefits, such as facilitating cross-border payments and providing a digital currency anchor point.

The investigation phase of the digital Euro is expected to be concluded by October 2023, Rehn said in a speech at the University of California on Wednesday.

The ECB will then decide whether to start building a digital Euro, Rehn said.

He saw several possible benefits to the idea of introducing a central bank digital currency, such as expanding the availability of central bank money to include payments between common people from transactions between banks only. The existing private crypto-assets’s limitations were “structural”, due to their volatile prices and vulnerability to cyber risks.“A digitally native form of secure central bank currency could enhance stability by providing a neutral and trusted settlement layer in the future financial system,” Rehn said, echoing recent comments by Federal Reserve Vice Chairman Lael Brainard.

In June, the Fed finished a four-month public consultation period seeking opinions on the idea of introducing a digital dollar, with Fed Chair Jerome Powell speaking in favor of it.