Post by account_disabled on Mar 8, 2024 22:25:00 GMT -5
The European Central Bank is carrying out an essential work so that European citizens and companies can use the digital euros issued by the ECB. Public digital money already exists, but now only banks can use it commercial. The objective is to have an infrastructure so that, as with physical euros, everyone can use digital euros and not just banks. Having this infrastructure is the first step in a structural reform of the monetary and banking system where digital euros will be the universally accepted means of digital payment. This structural change will be similar to what occurred in the 19th century with physical money. Commercial banks stopped issuing banknotes and today all physical money is issued by central banks. The digital money reform will have many positive effects. Stability will be achieved, because already there will be no banking crises, which are the most destructive crises because payments collapse. And also sand banking activities will be liberalized.
As has happened in recent decades in other activities (such as international trade, telecommunications, air transport or the introduction of the market in China), payment services and credit services will be subject to market rules. The fundamental advantage of digital euros over bank deposits is that Digital euros are money, while deposits are not money, they are a promise to return money. Digital euros are safe, risk-free assets and cannot collapse payments. Bank deposits, not being USA Phone Number euros but just a promise to pay euros, produce crises as soon as the banks cannot fulfill their promise. And, if the State did not save the banks, payments would collapse. Therefore, The State, to try to avoid banking crises, has been accumulating an enormous amount of protections and privileges for banks. For example, guaranteeing their deposits, helping them with liquidity loans, not letting them go bankrupt, using taxpayers' money to save the banks, and many more privileges that make the banking sector the most protected and intervened in the economy.
These state protections are very expensive for taxpayers and, in addition, have enormous indirect costs because, By preventing competition in payment and credit services, they reduce economic growth, efficiency and innovation. Banking activities cannot be liberalized now because, if deposit privileges were eliminated, banking crises would occur. But When digital euros are the means of payment, all these privileges can be eliminated without fear. Because digital euros, unlike deposits in banks, do not need any state protection. The digital euro does not need a deposit guarantee; you do not need liquidity loans because it is money and it is not a promise to pay money; does not need public resolution funds, etc. All liberalizations increase growth, innovation and the well-being of all citizens, but there is always negatively affected. In this liberalization they are banks, because they are going to have to transform their business model. And it would be reasonable to help banks transform to provide their services on a level playing field where no competitor has the protection of the State. However it should not hacer caso to those banks that, as help, ask put obstacles to the use of the digital eurol.
As has happened in recent decades in other activities (such as international trade, telecommunications, air transport or the introduction of the market in China), payment services and credit services will be subject to market rules. The fundamental advantage of digital euros over bank deposits is that Digital euros are money, while deposits are not money, they are a promise to return money. Digital euros are safe, risk-free assets and cannot collapse payments. Bank deposits, not being USA Phone Number euros but just a promise to pay euros, produce crises as soon as the banks cannot fulfill their promise. And, if the State did not save the banks, payments would collapse. Therefore, The State, to try to avoid banking crises, has been accumulating an enormous amount of protections and privileges for banks. For example, guaranteeing their deposits, helping them with liquidity loans, not letting them go bankrupt, using taxpayers' money to save the banks, and many more privileges that make the banking sector the most protected and intervened in the economy.
These state protections are very expensive for taxpayers and, in addition, have enormous indirect costs because, By preventing competition in payment and credit services, they reduce economic growth, efficiency and innovation. Banking activities cannot be liberalized now because, if deposit privileges were eliminated, banking crises would occur. But When digital euros are the means of payment, all these privileges can be eliminated without fear. Because digital euros, unlike deposits in banks, do not need any state protection. The digital euro does not need a deposit guarantee; you do not need liquidity loans because it is money and it is not a promise to pay money; does not need public resolution funds, etc. All liberalizations increase growth, innovation and the well-being of all citizens, but there is always negatively affected. In this liberalization they are banks, because they are going to have to transform their business model. And it would be reasonable to help banks transform to provide their services on a level playing field where no competitor has the protection of the State. However it should not hacer caso to those banks that, as help, ask put obstacles to the use of the digital eurol.