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German Banks Urge EU to Create a Digital Euro

November 4, 2019
Ross Peili


German Banks Urge EU to Create a Digital Euro

Banken Verband, a German association consisting of over 200 banks posted a report calling for a programmable digital Euro last Wednesday. 

It is no surprise that what appears to be a guideline/report on digital currencies starts with subjecting Facebook’s Libra, saying that there is no question that responsibility for the monetary system lies, and will continue to lie, with sovereign national states. 

In short, the association believes that any currency provided by private entities such as Facebook must comply with the state-determined system, citing that anything else would eventually lead to chaos and instability. 

Of course, we all know that this is not going to happen. Facebook is not keen to share its macro plans with governments, not to mention being controlled by them. Hence the report focuses all the way a digital currency should be representing Euro’s strength. 

Germany is not a skeptic but a doer

This is not the first time German financial institutions and regulators propose a digital currency, with Deutsche Bundesbank revealing just last month that they’ve been working on a national digital currency for some time now. 

According to Spiegel, a plan on creating a national blockchain strategy as proposed by the federal cabinet back in June 2019 is now in effect. 

While most EU countries are shaking at the thought Libra might take-over the local financial system, essentially threatening the Eurozone’s economic stability and sovereignty as expressed by France’s Minister of Finance Bruno Le Mair, Germany is not a thinker, but a doer. 

The country is one of the most friendly zones for blockchain startups and cryptocurrency projects, with IOTA, and Weeve being some of the most popular projects hailing from Germany. 

The first regulated STO (security token offering) was also approved by the German state earlier this year and in general, financial officers and bankers seem to be focused on cryptocurrency development trying to figure out their fitting position as a country. 

Urging traditional power-brokers to wake up

The Banken Verband Association is calling for better education, analysis, and implementation of blockchain technology and digital currencies, not just in Germany but on a pan-European level. 

Furthermore, the association is willing to help regulators and the current political and financial system to better understand the potential of such an economic shift, and help them work together in creating a digital version of Euro. 

The truth is, Libra might have sparked things up on a political level, but the real blow came from China, when President Xi Jinping publically announced that the country is focusing all its research and development resources into blockchain technology, citing that it is the most innovative technology of our times. 

Germany even as one of the most important member countries of the EU, meaning that they’re walking holding-hands with the Queensland system (UK, US, CA, AU…) which has a unique relationship with China hailing back to the first two industrial revolutions.

Things haven’t changed a lot nowadays, with the fourth industrial revolution only strengthening the unique relationship between the two countries, focusing on digital economies, autonomous smart-cities, the internet of things and more aspects of the I.4.0.

It appears Germany is trying to stay ahead of the game, this time following China and not the Western powers, as it is now clear who’s leading the future economic and technological development on a global scale. 

Cryptos in EU today

Recently the French Ministry of Education proposed introducing a class on digital currencies and decentralized economies into the academic cycle, starting from as early as high-school. 

Missing intel regarding the EU’s stance on cryptos? Check our article about the European Central Bank’s head talking crypto.

Want to understand how educated Germany actually is when it comes to digital currencies? Check this piece to see how a Bitcoin transaction led German authorities to seize a far-right extremist terrorist group. 

One of the largest EU banks, the Dutch ING gave away blockchain tips to one of the most advanced blockchain firms.

Overall, unlike the U.S and China, where cryptocurrency laws and regulations are pretty much the same everywhere with minimal variations, in the EU each country member has its own unique approach to the matter and it creates an even more decentralized feeling even under the EU regulatory framework.