emirates7 - The European Central Bank (ECB) has proposed handing EU capitals more power over the design of a digital version of the euro, opening a path to a deal on the controversial project after a year of deadlock.
The concession, yet to be signed off, would allow member countries to have the final say on the maximum amount of digital euros consumers can hold in their digital wallets at any one time, answering a key concern of some countries as well as the banking sector.
Finance ministers will discuss the proposal this week at a meeting in Copenhagen, where they could informally accept it.
The Frankfurt-based ECB wants to get its plan for a purely digital version of the euro signed off as soon as possible, fearing a major delay will mean it loses ground to US-based private sector payment systems, particularly dollar-denominated "stablecoin" cryptocurrencies.
The new proposal offers a compromise, stating that the ECB will begin consultations with governments two years ahead of the digital euro’s issuance, and will propose an overall limit one year prior to its launch. This will need the support of a reinforced qualified majority among eurozone governments, the strongest possible majority used in EU voting procedures.
The same reinforced majority will be necessary to make any subsequent changes to the ceiling proposed by the ECB. That means giving governments more weight in the decision process.
The concession, yet to be signed off, would allow member countries to have the final say on the maximum amount of digital euros consumers can hold in their digital wallets at any one time, answering a key concern of some countries as well as the banking sector.
Finance ministers will discuss the proposal this week at a meeting in Copenhagen, where they could informally accept it.
The Frankfurt-based ECB wants to get its plan for a purely digital version of the euro signed off as soon as possible, fearing a major delay will mean it loses ground to US-based private sector payment systems, particularly dollar-denominated "stablecoin" cryptocurrencies.
The new proposal offers a compromise, stating that the ECB will begin consultations with governments two years ahead of the digital euro’s issuance, and will propose an overall limit one year prior to its launch. This will need the support of a reinforced qualified majority among eurozone governments, the strongest possible majority used in EU voting procedures.
The same reinforced majority will be necessary to make any subsequent changes to the ceiling proposed by the ECB. That means giving governments more weight in the decision process.