- The De Nederlandsche Bank is positive on the adoption of digital currency as a solution to face the economic fallout amid the COVID-19.
The Dutch Central Bank is considering the adoption of a central bank digital currency (CBDC). The bank has announced that it wants to test a digital currency established by itself and other major European financial institutions.
The De Nederlandsche Bank referred to the global pandemic and how the global economy is going for a toss. It stated that the use of fiat is declining significantly and consumers are using less capital from the central bank to purchase goods and services. This has in turn prompted banks to resort to new forms of currency to tackle the problem, and the DNB thinks that CBDC could be a possible solution to meet the people’s interests. CBDCs can not only improve cross-border payments, but it also addresses domestic payment options.
DNB further stated how digital currencies can help people and businesses withstand this economic turmoil as they attempt to circumvent banking risks by shifting their capital reserves in these commercial institutions into CBDC. This crucial time, makes it very important for the government to take appropriate measures to adapt to the immediate needs of the country through innovative initiatives.
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