Digital Euro, CBDCs, and Crypto Adoption in Spain

Margarita Delgado, the Deputy Governor of Spain’s central bank, has discussed the evolving relationship between the planned digital euro and private payment technologies. She aligns her views with the newly suggested legislative framework for a digital euro, stating that it will likely foster the growth of pan-European financial and payment services in the private sector.

Delgado posits that these advancements will help Europe’s financial system better rival non-European options.

The popularity of Central Bank Digital Currencies (CBDCs) is on the rise, with around 130 nations currently looking into their deployment. However, regulators are exercising caution to avoid pitfalls while allowing usage, a challenging equilibrium to achieve.

U.S. Congressman Warren Davidson has expressed skepticism about CBDCs, even calling for their prohibition. In contrast, Governor Margarita foresees the digital euro reshaping the payments landscape. She notes that the European Commission is committed to ensuring the digital euro is inclusive and does not restrict what it can be used for.

A recent report by Australia’s central bank indicated that its digital dollar could spur innovation and economic growth, although it also stated more study is needed to fully understand the potential benefits of a CBDC.

Public opinion on CBDCs is divided; some see them as innovative financial instruments while others regard them as a route to increased governmental control.

Regarding crypto adoption in Spain, the timing of Margarita’s comments is noteworthy, given the increasing acceptance of cryptocurrencies in the country. Spain is ranked 22nd globally in terms of crypto adoption, according to Statista.

Bitnovo, a Spanish crypto firm, recently published research indicating that cryptocurrency is the second most popular payment method in Spain. The report also found that 60.7% of Spaniards invest in cryptocurrencies for the long term, 35.7% use them for payments, 21.4% engage in short-term trading, and 17.9% buy crypto out of sheer curiosity.

As debates over the impact of CBDCs continue, Spain’s relatively relaxed approach to crypto regulations appears to be influencing the country’s increasing adoption of digital assets.

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