Central Bank of Cyprus official outlines rationale for digital euro
Stelios Georgakis says a digital euro would enable digital payments with central bank money across the euro area while complementing cash and existing private payment solutions.
Nicosia, Cyprus. A digital euro would allow Europeans to use central bank money for digital payments across the euro area without replacing cash, according to Stelios Georgakis, head of the Directorate General Payments at the Central Bank of Cyprus. He presented the rationale for the digital euro as comprising four distinct pillars.
Openness and resilience
Georgakis described Cyprus as historically standing at the crossroads of continents, cultures and trade routes, benefiting from openness, connectivity and exchange. He said that history illustrated how openness creates opportunities while resilience ensures continuity.
He linked that lesson to the economy’s digital transformation, which is changing communication, business practices and everyday interactions.
Digital payments have become part of daily life, with consumers expecting fast, convenient and seamless transactions when shopping online, paying bills, sharing expenses or making purchases in stores. Georgakis said evolving payment habits raised the question of whether the forms of money people use should also evolve.
Adapting central bank money
The first pillar Georgakis outlined concerned adapting central bank money to an increasingly digital economy. Consumers are using digital payments more frequently, online commerce continues to expand, and mobile devices are becoming the preferred payment tool for many citizens.
At the same time, central bank money remains available to the public only in physical form, through banknotes and coins. Georgakis described this as a gap that the digital euro would bridge.
A digital euro would enable payments using central bank money anywhere in the euro area, at physical points of sale, online and between individuals. It would complement euro banknotes and coins, as well as existing private digital payment solutions.
Cash would retain its role
Georgakis stressed that the digital euro is not intended to replace cash, which he described as a vital public good and an essential part of the monetary system.
He cited 31 billion euro banknotes in circulation, worth more than €1.6 trillion, alongside 150 billion euro coins, as evidence of cash’s continuing importance. He also said two important developments demonstrated its endurance.
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