In a speech last week, the Deputy Governor of the Bank of Spain, Margarita Delgado, discussed the digital euro. She repeated the need to ensure banks are not overly impacted by introducing a central bank digital currency (CBDC).
Not mentioned in the speech is the recent article published by two academics. It argues that the design of the digital euro is tip-toeing around banks so much that it risks the failure of the digital euro initiative. Some academics in the United States take it further arguing that replacing banks as deposit takers (not lenders) would remove instability from the system.
Circling back to the Spanish speech, how will the digital euro take account of banks? The Deputy Governor outlined three ways.
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