TechFlow news, April 20 — According to Bitcoin.com, the European Central Bank's (ECB) latest report shows that although the digital euro project has not yet received final approval, the central bank digital currency (CBDC), once launched, will significantly change how Europeans use money.
The study predicts that the digital euro has the potential to replace 5 euros of every 10 euros in cash currently in circulation. Meanwhile, for every 10 digital euros issued, 3 euros will be withdrawn from bank deposits.
The report analyzes the impact under three different adoption scenarios:
- In a low-adoption scenario, approximately 15 billion euros in cash would be replaced;
- In a medium-adoption scenario, around 125 billion euros in cash would exit the market;
- In a high-adoption scenario, the digital euro could replace about 256 billion euros in cash.
However, even under the highest adoption forecast, the use of digital euros would still be relatively limited, as the total amount of euro banknotes in circulation currently exceeds 1.56 trillion euros.
In contrast to the United States, where there has been recent opposition to issuing a digital dollar, Europe is actively advancing its digital euro project to counter the growing influence of dollar-denominated stablecoins and other cryptocurrencies. ECB Executive Board member Piero Cipollone stated in January this year that the digital euro would serve as a "firewall" against the rise of these bankless solutions.
