SiGMA News asked Professor Philip von Brockdorff if its time for the European Central Bank to consider digital currency.
LH: Do you believe that the European Central Bank will get its own digital currency?
Professor Philip Brockdorff: The ECB is also tinkering with the idea of a digital currency but is being very cautious and rightly so given the largely negative experience of crypto assets.
LH: What are your comments about plans for the proposed public consultation to help the Bank of England and UK government develop a policy on regulation of crypto assets in the UK?
Professor Philip Brockdorff: This has in fact spurred the European Commission to propose legislation to regulate crypto assets in the EU.
LH: Regulation of the crypto markets in the EU are due to come into effect in 2024. How do you see euro digital currency evolve?
Professor von Brockdorff: One cannot dismiss the potential of Fintech as well as the eventual introduction of a euro digital currency. I believe it’s only a matter of time and UK Treasury appears to be taking the lead in this regard.
LH: I quote Andrew Griffith, the UK Economic Secretary to the Treasury, who last week said “I want the right regime, operated in the right way, that has the right balances in it”. What are your views about these developments?
Professor von Brockdorff: This could be an interesting development though I suggest the motive behind it is to provide a much needed boost to the British economy after Brexit with all its economic ramifications.
LH: When do you think that we will see the launch of a euro digital currency?
Professor von Brockdorff: As far as the ECB is concerned, any introduction of a euro digital currency will only come into effect after the introduction of EU legislation on crypto assets and EU inflation being restored to the target level.
Professor Philip von Brockdorff is Governor of the Malta Financial Services Authority (MFSA). He is head of the Department of Economics at the University of Malta. He is a member of the European Economic and Social Committee (EESC) and serves as rapporteur for a number of important dossiers requested by the European Commission. Previously Professor von Brockdorff served as Permanent Secretary for economic growth for 7 years. His area of expertise is demographic economics with a focus on policy analysis and the role of the euro in international markets.