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Following “Libra” German banks say: The economy needs a programmable digital euro

Author(s): Andreas Krautscheid, Tobias Tenner, Siegfried Utzig

Date published: Nov 2019

SUERF Policy Note, Issue No 116
by Andreas Krautscheid, Tobias Tenner, and Siegfried Utzig
Association of German Banks


JEL-codes: E58, F33, F42; G21, G23.
Keywords: Stablecoin, cryptocurrencies, Libra, Facebook, programmable digital money, Fourth Industrial Revolution, banks, central banks, central bank digital currency, smart contract, automatization.

Facebook’s announcement of its plans to launch a digital currency has attracted considerable attention. However, financial inclusion and high costs for foreign bank transfers are not the problems that are first thought of in Europe when the question is asked as to who will need digital money and for what purpose. The German private banks rate programmable digital money as an innovation with great potential that can be a key component in the next stage of the evolution of digitalisation. They will play their part in establishing a sustainable and innovative monetary system. For this purpose, a programmable account and crypto-based digital euro should be created and its interoperability with book money ensured. The condition for this is establishing a common pan-European payments platform for the programmable digital euro.

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SUERF Policy Note, Issue No 116SUERF Policy Note, Issue No 116

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