Bank of France Governor, Francois Villeroy de Galhau stated on Friday that as a few countries are struggling with cash transactions, digital currency could turn out to be useful. Triggered by the rise of Cryptocurrencies and Facebook’s Libra, Central Banks all around the world are planning on giving digital money a whirl to avoid the possibility of losing state control over money. Villeroy denied that the proposal is in response to Facebook’s Libra plan, but a reaction to fast-evolving technology and that a few banks around the globe are in need of digital currency. He also emphasized that sooner rather than later, individual might look for more expansive options and alternatives to cash.
“In some northern European countries, notably Sweden and the Netherlands, the use of banknotes is falling extremely quickly and they are wondering whether we need to give citizens the right to digital money that is no longer a physical bank note but which has the same quality, notably the security of a central bank,” he told France Inter radio.
Asked whether private companies have the prerogative to launch such digital money, Bank of France Governor went ahead and said that one can’t consider a currency as private, as money falls under the category of sovereignty and is a public good. Villeroy further added that the Eurosystem euro-zone central banks would be looking into the central bank’s experiments with digital money.
Bank of France Following The Same Path as Bank of England
The Bank of England in Tuesday’s announcement entered a partnership with other banks to study what the future of digital currencies backed by Central Bank might be. Other partners of the group are Bank of Japan and the European Central Bank, and they all would work with the Bank of International Settlements (BIS) to understand the possibilities of a central digital currency.