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HDE demand: Digital Euro against Facebook’s Libra and credit card provider

Last updated on March 9, 2021

03.12.2019, 08:28 pm

The German trade association wants a regulated, state-backed digital euro. This should create an alternative to credit card providers and currencies like Facebook’s Libra.

As early as 2008, the German Trade Association (HDE) and the Federal Association of Service Providers for Online Providers (BDOA) had discussed with the European Central Bank the issue of euro cash in a digital dimension. Ahead of Thursday’s meeting of EU finance ministers, the two associations again called for the introduction of a state digital euro . The economy needs independent alternatives to global payment systems in an increasingly digital world, the letter said.

Digital Euro: data-sparse transactions

HDE Chief Executive Stefan Genth emphasized in his letter addressed to Federal Finance Minister Olaf Scholz that a digital euro would make the European economy more independent of central system operators such as credit card organizations or blockchain-based providers. “For retailers and consumers, it’s important to complete a business safely, efficiently and with a low data-base, based on a stable currency. The digital euro can contribute to that, “says Genth.

Explicitly as an opponent called the trade association Facebook’s planned digital currency Libra. Corresponding reservations have, according to a statement from September, the Federal Government. The skepticism is apparently not only against Libra, but against any kind of Stablecoins. These are not stable in themselves, so the criticism. The HDE sees US tech giants such as Facebook also in danger that these put the data collection in the foreground. As a result, trade threatens to lose contact with customers. “Global players are taking over this gatekeeper function,” said Genth.

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Positive impact on the economy

According to the HDE and BDOA, the issuance of state-regulated digital money could also lead to “positive macroeconomic income effects”. The ECB could also strengthen its influence, which the associations see endangered in the context of non-bank crypto-pollutions. And finally, the Swedish Reichsbank is already preparing its own digital currency, the so-called E-Krona . It remains to be seen to what extent the ECB and EU finance ministers will engage in such considerations. According to a media report, a corresponding project should even be in the planning stage.