The Consensus 2020 crypto event has officially started, and for the first time, as a completely virtual conference due to COVID-19 at which the European Central Bank (ECB) was the main attraction, with Yves Mersch as its legal official and first speaker.
Mersch is also an ECB board member. On May 11, he talked at Consensus 2020 about central bank digital currencies (CBDCs) and how consumers could use them. He started his speech at 6:45 am ET, outlining that the ECB is focusing on implementing a CBDC for the retail sector.
What’s All This About the ECB Focusing on Retail Implementation of a CBDC?
Discussing the opposition between retail CBDCs and central digital bank money in the wholesale area, Mersch said the implementation of a CBDC would take place in the same manner as the usual business does. Here are his exact words on this:
“You may wonder why central banks have not chosen to provide retail access to central bank money despite access to the technology so far […] The main reason is that introducing a retail CBDC could have major consequences for the whole financial system.”
It seems the ECB is one of the first central banks focused on retail CBDC. A blockchain firm R3’s report from April says the already going-on global central banks’ CBDC projects represent in fact the wholesale implementation of this approach. Mersch pinpointed that wholesale CBDCs are the main focus of central banks because there are risks involved with them, risks that the whole international financial system is becoming too shaken about.
There Are No Signs Cash Will Disappear
Meanwhile, even if the ECB is focusing on the implementation of a CBDC, Mersch still thinks wide adoption depends on people’s preferences. He added that cash still remains a principal method of payment in the EU. Around 76% of transactions in this region are in cash. However, the ECB wants to implement CBDC solutions when these are needed. Consensus 2020 expects over 13,000 participants in the May 11 to May 15 time period, at over 100 online sessions. The event is taking place virtually because of the COVID-19 pandemic.