The European Central Bank is launching a two-year investigation on whether to introduce a digital version of the euro to complement cash.

The ECB said in a statement that the digital euro must be able to meet consumers’ needs while helping prevent illegal activity such as money laundering and must not have an adverse impact on financial stability and monetary policy.

Digitalisation “is reaching all areas of our lives,” Fabio Panetta, a member of the ECB’s executive board, wrote in a blog post.

He said: “The coronavirus pandemic has shown just how fast such change can happen. 

“And this is affecting the way we pay. 

“We are increasingly buying digitally and online.”

He said that there were many questions to be answered and that “a decision about whether or not to issue a digital euro will only come at a later stage”.

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