Banque de France governor Francois Villrois de Galo said that the EU is ready to launch the second phase of the test of the wholesale CBDC. In doing so, the regulator expects to release the digital euro on the open market as early as next year.
“We want to develop the most viable prototype currency possible, testing it in practice with the participation of private entities and foreign central banks. This will happen in the second half of 2022. This will ensure that we will be ready to use CBDC as a means of settlement in as little as a year from now.” – the official stressed.
The integration of the digital euro will greatly simplify cross-border transactions. However, so far we are talking only about the wholesale version of CBDC, which will have access to large corporations and banks, but not the retail sector.
The first phase of the pilot project ended in December 2021. In May, ECB board member Fabio Panetta predicted the launch of CBDC in 2023. Later, in June, he said that the total supply of digital euros could be reduced to 1-1.5 trillion tokens to minimize the risks to the traditional financial system.
Unlike cryptocurrencies, CBDCs are the digital equivalent of fiat. For example, de Galo himself stated that it is an effective way to preserve the power of the Central Bank in the face of the threat of virtualization of the economy.
Also during the Europlace forum, the official summed up the EU’s success in regulating the digital asset market. Among other things, he mentioned the implementation of FATF-recommended anti-money laundering regulations.