Bank Of France Gov Says Central Banks Should Control Crypto

Bank of France Governor Francois Villeroy de Galhau said on Saturday (Jan. 25) that central banks should be in charge of issuing electronic currency, not private companies, Reuters reported.

Partially brought on by the emergence of cryptocurrencies and Facebook’s upcoming introduction of the Libra coin, central banks across the globe have been looking into launching eCurrency as a means of maintaining states’ control over money.

Villeroy said the plans were not because of Facebook’s Libra, but because of the speed of technology and the desire for digital currency by some banks. He noted that private citizens also might ask for cash alternatives. 

“In some northern European countries, notably Sweden and the Netherlands, the use of banknotes is falling extremely quickly and they are wondering whether we need to give citizens the right to digital money that is no longer a physical bank note but which has the same quality, notably the security of a central bank,” he told France Inter radio, as reported by Reuters.

Asked whether such digital money could be issued by private companies, Villeroy said that “currency cannot be private, money is a public good of sovereignty.”

He added that “central banks were planning experiments with digital money and that the issue would be studied by the Eurosystem eurozone central banks.”

Some central banks are banding together to form a group that will study ways and means of issuing central bank digital currencies (CBDC), according to a release by the Bank of England on Jan. 21.

Collaborating banks include The Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Sveriges Riksbank, the Swiss National Bank and the Bank for International Settlements (BIS).

“The group will assess CBDC use cases; economic, functional and technical design choices, including cross-border interoperability; and the sharing of knowledge on emerging technologies. It will closely coordinate with the relevant institutions and forums – in particular, the Financial Stability Board and the Committee on Payments and Market Infrastructures (CPMI),” the release said.