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Rösl, G., Seitz, F. Central Bank Digital Currency and Cash in the Euro Area: Current Developments and one Specific Proposal. Credit and Capital Markets – Kredit und Kapital, 55(4), 523-551. https://doi.org/10.3790/ccm.55.4.523
Rösl, Gerhard and Seitz, Franz "Central Bank Digital Currency and Cash in the Euro Area: Current Developments and one Specific Proposal" Credit and Capital Markets – Kredit und Kapital 55.4, 2022, 523-551. https://doi.org/10.3790/ccm.55.4.523
Rösl, Gerhard/Seitz, Franz (2022): Central Bank Digital Currency and Cash in the Euro Area: Current Developments and one Specific Proposal, in: Credit and Capital Markets – Kredit und Kapital, vol. 55, iss. 4, 523-551, [online] https://doi.org/10.3790/ccm.55.4.523
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Central Bank Digital Currency and Cash in the Euro Area: Current Developments and one Specific Proposal

Rösl, Gerhard | Seitz, Franz

Credit and Capital Markets – Kredit und Kapital, Vol. 55 (2022), Iss. 4 : pp. 523–551

2 Citations (CrossRef)

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Article Details

Publisher Name
Duncker & Humblot
DOI
https://doi.org/10.3790/ccm.55.4.523
Language
English
Pages
29
Keywords

Author Details

Prof. Dr. Gerhard Rösl, Technical University of Applied Sciences (OTH) Regensburg, Seybothstrasse 2, D-93053 Regensburg.

Prof. Dr. Franz Seitz, Technical University of Applied Sciences (OTH) Weiden, Hetzenrichter Weg 15, D-92637 Weiden.

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    2024

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  2. Exploring Central Bank Digital Currencies

    Navigating the Digital Paradigm Shift

    Kumar, Pawan | Taneja, Sanjay | Bhatnagar, Mukul | Kaur, Arvinder K.

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References

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  2. Adalid, R./Álvarez-Blázquez, A./Assenmacher, K./Burlon, L./Dimou, M./López-Quiles, C./Fuentes, N. M./Meller, B./Muñoz, M.A./Radulova, P./Rodriguez d’Acri, C./Shakir, T./Šílová, G./Soons, O./Ventula Veghazy, A. (2022): Central Bank Digital Currency and Bank Intermediation: Exploring different approaches for assessing the effects of a digital euro on euro area banks, ECB Occasional Paper No 293, May.  Google Scholar
  3. Adams, J. (2006): The War on Cash, European Card Review, March/April, 12–18.  Google Scholar
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  5. Ahnert, T./Hoffmann, P./Monnet, C. (2022): The Digital Economy, Privacy, and CBDC, ECB Working Paper Series, No 2662, May.  Google Scholar
  6. Amromin G./Chakravorti, S. (2009): Whither Loose Change? The Diminishing Demand for Small-Denomination Currency, Journal of Money, Credit and Banking, Vol. 41(2–3), 315–335.  Google Scholar
  7. Ardizzi, G./Nobili, A./Rocco, G. (2020): A Game Changer in Payment Habits: Evidence from daily data during a pandemic, Banca d’Italia, Occasional Paper, No 591, December.  Google Scholar
  8. Auer, R./Böhme R. (2020): The Technology of Retail Central Bank Digital Currency, BIS Quarterly Review, March, 85–100.  Google Scholar
  9. Barontini, C./Holden, H. (2019): Proceeding with Caution: A Survey on Central Bank Digital Currency, BIS Papers, No 101, February.  Google Scholar
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  11. Bechtel, A./Otto-Schleicher, D. (2021): Possible Characteristics of a TIPS-Based Digital Euro, EU Blockchain: Observatory and Form.  Google Scholar
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  24. European Central Bank (2019): In Focus: Exploring anonymity in central bank digital currencies, No 4, December.  Google Scholar
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  27. European Central Bank (2021a): Digital Euro Experimentation Scope and Key Learnings.  Google Scholar
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  30. European Central Bank (2022b): The Case for a Digital Euro: Key objectives and design considerations, July.  Google Scholar
  31. Hauser, A. (2022): Old Dogs, New Tricks: Adapting central bank balance sheets to a world of digital currencies, remarks given at Federal Reserve Bank of New York and Columbia SIPA workshop on ‘Monetary Policy Implementation and Digital Innovation’, 1 June 2022.  Google Scholar
  32. Jonker, N./van der Cruijsen, C./Bijlsma, M./Bolt, W. (2022): Pandemic Payment Patterns, Journal of Banking and Finance, Vol. 143, 106593.  Google Scholar
  33. Kantar Public (2022): Study on New Digital Payment Methods, Study commissioned by the European Central Bank, March.  Google Scholar
  34. Keister, T./Monnet, C. (2022): Central Bank Digital Currency: Stability and information, Study Center Gerzensee, Working Paper 22.03, May.  Google Scholar
  35. Kosse, A./Mattei, I. (2022): Gaining Momentum: Results of the 2021 BIS survey on central bank digital currencies, BIS Papers No. 125, May.  Google Scholar
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  37. Krüger, M./Seitz, F. (2017): The Benefits of Cash (Module 2), Fritz Knapp Publisher, Frankfurt/Main.  Google Scholar
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  39. Lalouette, L./Zamora-Pérez, A./Rusu, C./Bartzsch, N./Politronacci, E./Delmas, M./Rua, A./Brandi, M./Naksi, M. (2021): Foreign demand for euro banknotes, Occasional Paper Series, No. 253, European Central Bank, Frankfurt am Main, January.  Google Scholar
  40. Mersch, Y. (2016): Bares bleibt Wahres, Gastbeitrag, Spiegel Online, 5 May 2016,  Google Scholar
  41. Nivette, A./Zahnow, R./Aguilar R./Ahven, A./Amram, S./Ariel, B./Arosemena-Burbano, M. J./Baier, D./Bark, H.-M./Beijers, J. E. H./Ber, M. (2021): A Global Analysis of the Impact of COVID-19 stay-at-home Restrictions on Crime, Nature Human Behaviour, Vol. 5, 868–877.  Google Scholar
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  43. Panetta, F. (2022b): The Digital Euro and the Evolution of the Financial System. Introductory statement at the Committee on Economic and Monetary Affairs of the European Parliament, Brussels, 15 June.  Google Scholar
  44. Panetta, F. (2022c): A Digital Euro that Serves the Needs of the Public: Striking the right balance, Introductory statement at the Committee on Economic and Monetary Affairs of the European Parliament, Brussels, 30 March.  Google Scholar
  45. Rogoff, K. S. (2016): The Curse of Cash, Princeton University Press, Princeton and Oxford.  Google Scholar
  46. Rösl, G./Seitz, F. (2022a): Cash Demand in Times of Crisis, Journal of Payment Systems & Strategies, Vol. 16(2).  Google Scholar
  47. Rösl, G./Seitz, F. (2022b): On the Stabilizing Role of Cash for Societies, IMFS Working Papers, No. 167.  Google Scholar
  48. Rösl, G./Seitz, F./Tödter, K.-H. (2019): The Cost of Overcoming the Zero Lower-Bound: A Welfare Analysis, Economies Vol. 7(67), 1–18.  Google Scholar
  49. Rua, A. (2021): Modelling Currency Demand: The case of the euro, Empirical Economics, Vol. 61, 1865–1881.  Google Scholar
  50. Sands, P. (2016): Making it Harder for the Bad Guys: The case for eliminating high denomination notes, m-rcbg Associate Working Paper Series No 52, Cambridge: Harvard Kennedy School.  Google Scholar
  51. Scheiber, T./Stern, C. (2016): Currency Substitution in CESEE: Why do households prefer euro payments? Oesterreichische Nationalbank (ed.), Focus on European Economic Integration, No. 4, 73–98.  Google Scholar
  52. Scheiber, T./Stix, H. (2009): Euroization in Central, Eastern and Southeastern Europe: New evidence on its extent and some evidence on its causes, Working Paper, No. 159, Oesterreichische Nationalbank.  Google Scholar
  53. Seitz, F./Devigne, L./de Pastor, R. (2022): Different Motives for Holding Cash in France: An Analysis of the Net Cash Issues of the Banque de France, Banque de France Working paper 888, October.  Google Scholar
  54. Zamora-Pérez, A. (2021): The Paradox of Banknotes: Understanding the demand for cash beyond transactional use, European Central Bank, Economic Bulletin 2/2021, 121–137.  Google Scholar
  55. Zamora-Pérez, A./Coschignano, E./Barreiro, L. (2022): Ensuring Adoption of Central Bank Digital Currencies – An easy task or a Gordian knot?, ECB Occasional Paper Series No 307, October.  Google Scholar
  56. Abramova, S./Böhme, R./Elsinger, H./Stix, H./Summer, M. (2022): What can CBDC Designers Learn from Asking Potential Users? Results from a survey of Austrian residents, OeNB Working Paper, 241.  Google Scholar
  57. Adalid, R./Álvarez-Blázquez, A./Assenmacher, K./Burlon, L./Dimou, M./López-Quiles, C./Fuentes, N. M./Meller, B./Muñoz, M.A./Radulova, P./Rodriguez d’Acri, C./Shakir, T./Šílová, G./Soons, O./Ventula Veghazy, A. (2022): Central Bank Digital Currency and Bank Intermediation: Exploring different approaches for assessing the effects of a digital euro on euro area banks, ECB Occasional Paper No 293, May.  Google Scholar
  58. Adams, J. (2006): The War on Cash, European Card Review, March/April, 12–18.  Google Scholar
  59. Ahnert, T./Assenmacher, K./Hoffmann, P./Leonello, A./Monnet, C./Porcellacchia, D. (2022): The Eonomics of Central Bank Digital Currency, ECB Working Paper Series, No 2713, August.  Google Scholar
  60. Ahnert, T./Hoffmann, P./Monnet, C. (2022): The Digital Economy, Privacy, and CBDC, ECB Working Paper Series, No 2662, May.  Google Scholar
  61. Amromin G./Chakravorti, S. (2009): Whither Loose Change? The Diminishing Demand for Small-Denomination Currency, Journal of Money, Credit and Banking, Vol. 41(2–3), 315–335.  Google Scholar
  62. Ardizzi, G./Nobili, A./Rocco, G. (2020): A Game Changer in Payment Habits: Evidence from daily data during a pandemic, Banca d’Italia, Occasional Paper, No 591, December.  Google Scholar
  63. Auer, R./Böhme R. (2020): The Technology of Retail Central Bank Digital Currency, BIS Quarterly Review, March, 85–100.  Google Scholar
  64. Barontini, C./Holden, H. (2019): Proceeding with Caution: A Survey on Central Bank Digital Currency, BIS Papers, No 101, February.  Google Scholar
  65. Bartzsch, N./Rösl, G./Seitz, F. (2011): Foreign Demand for Euro Banknotes Issued in Germany: Estimation using direct approaches, Deutsche Bundesbank Discussion Paper, Series 1: Economic Studies (20/2011).  Google Scholar
  66. Bechtel, A./Otto-Schleicher, D. (2021): Possible Characteristics of a TIPS-Based Digital Euro, EU Blockchain: Observatory and Form.  Google Scholar
  67. Bindseil, U./Panetta, F./Terol, I. (2021): Central Bank Digital Currency: Functional scope, pricing and controls, ECB Occasional Paper No 286, December.  Google Scholar
  68. Boar, C./Wehrli, A. (2021): Ready, Steady, Go? Results of the third BIS survey on central bank digital currency, BIS Papers, No 114, January.  Google Scholar
  69. Brunnermeier, M. K./Niepelt, D. (2019): On the Equivalence of Private and Public Money, Journal of Monetary Economics, Vol. 106(C), 27–41.  Google Scholar
  70. Buiter, W./Rahbari, E. (2015): High Time to Get Low: Getting Rid of the Lower-bound on Nominal Interest Rates, Global Economics View, Citi Research, 9 April.  Google Scholar
  71. Deutsche Bundesbank (2021): What do Households in Germany Think about the Digital Euro? First results from surveys and interviews, Monthly report, October, 65–84.  Google Scholar
  72. Deutsche Bundesbank (2022a): Demand for Euro Banknotes issued by the Bundesbank: Current developments, Monthly Report, April, 67–83.  Google Scholar
  73. Deutsche Bundesbank (2022b): Payment Behaviour in Germany in 2021.  Google Scholar
  74. Esselink, H./Hernandez, L. (2017): The Use of Cash by Households in the Euro Area, ECB Occasional Paper No. 201, November.  Google Scholar
  75. EU-Commission (2017): Proposal for an EU Initiative on Restrictions on Payments in Cash, 23.1.2017, European Commission, Brussels.  Google Scholar
  76. EU-Commission (2018): Report from the Commission to the European Parliament and the Council on Restrictions on Payments in Cash, 12.6.2018.  Google Scholar
  77. European Central Bank (2000): Issues Arising from the Emergence of Electronic Money, Monthly Report, November, 49–60.  Google Scholar
  78. European Central Bank (2016): ECB Ends Production and Issuance of € 500 Banknote, press release, 4 May.  Google Scholar
  79. European Central Bank (2019): In Focus: Exploring anonymity in central bank digital currencies, No 4, December.  Google Scholar
  80. European Central Bank (2020a): Report on a Digital Euro, October.  Google Scholar
  81. European Central Bank (2020b): Study on the Payment Attitudes of Consumers in the Euro Area (SPACE), December.  Google Scholar
  82. European Central Bank (2021a): Digital Euro Experimentation Scope and Key Learnings.  Google Scholar
  83. European Central Bank (2021b): Eurosystem Launches Digital Euro Project, press release,14 July 2021.  Google Scholar
  84. European Central Bank (2022a): Annual Accounts of the ECB for 2021.  Google Scholar
  85. European Central Bank (2022b): The Case for a Digital Euro: Key objectives and design considerations, July.  Google Scholar
  86. Hauser, A. (2022): Old Dogs, New Tricks: Adapting central bank balance sheets to a world of digital currencies, remarks given at Federal Reserve Bank of New York and Columbia SIPA workshop on ‘Monetary Policy Implementation and Digital Innovation’, 1 June 2022.  Google Scholar
  87. Jonker, N./van der Cruijsen, C./Bijlsma, M./Bolt, W. (2022): Pandemic Payment Patterns, Journal of Banking and Finance, Vol. 143, 106593.  Google Scholar
  88. Kantar Public (2022): Study on New Digital Payment Methods, Study commissioned by the European Central Bank, March.  Google Scholar
  89. Keister, T./Monnet, C. (2022): Central Bank Digital Currency: Stability and information, Study Center Gerzensee, Working Paper 22.03, May.  Google Scholar
  90. Kosse, A./Mattei, I. (2022): Gaining Momentum: Results of the 2021 BIS survey on central bank digital currencies, BIS Papers No. 125, May.  Google Scholar
  91. Kovacs, S./Rieg, J./Welz, M. (2014): Internet Payment Methods: Regulatory requirements for payment services and the e-money business, Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin).  Google Scholar
  92. Krüger, M./Seitz, F. (2017): The Benefits of Cash (Module 2), Fritz Knapp Publisher, Frankfurt/Main.  Google Scholar
  93. Lalouette, L./Esselink, H. (2018): Trends and Developments in the Use of Euro Cash over the Past ten Years, European Central Bank, Economic Bulletin, Vol. 6, 87–109.  Google Scholar
  94. Lalouette, L./Zamora-Pérez, A./Rusu, C./Bartzsch, N./Politronacci, E./Delmas, M./Rua, A./Brandi, M./Naksi, M. (2021): Foreign demand for euro banknotes, Occasional Paper Series, No. 253, European Central Bank, Frankfurt am Main, January.  Google Scholar
  95. Mersch, Y. (2016): Bares bleibt Wahres, Gastbeitrag, Spiegel Online, 5 May 2016,  Google Scholar
  96. Nivette, A./Zahnow, R./Aguilar R./Ahven, A./Amram, S./Ariel, B./Arosemena-Burbano, M. J./Baier, D./Bark, H.-M./Beijers, J. E. H./Ber, M. (2021): A Global Analysis of the Impact of COVID-19 stay-at-home Restrictions on Crime, Nature Human Behaviour, Vol. 5, 868–877.  Google Scholar
  97. Panetta, F. (2022a): Bringing European Payments to the Next Stage: A public-private endeavour, Keynote speech at the European Payments Council’s 20th anniversary conference, Frankfurt am Main, 16 June 2022.  Google Scholar
  98. Panetta, F. (2022b): The Digital Euro and the Evolution of the Financial System. Introductory statement at the Committee on Economic and Monetary Affairs of the European Parliament, Brussels, 15 June.  Google Scholar
  99. Panetta, F. (2022c): A Digital Euro that Serves the Needs of the Public: Striking the right balance, Introductory statement at the Committee on Economic and Monetary Affairs of the European Parliament, Brussels, 30 March.  Google Scholar
  100. Rogoff, K. S. (2016): The Curse of Cash, Princeton University Press, Princeton and Oxford.  Google Scholar
  101. Rösl, G./Seitz, F. (2022a): Cash Demand in Times of Crisis, Journal of Payment Systems & Strategies, Vol. 16(2).  Google Scholar
  102. Rösl, G./Seitz, F. (2022b): On the Stabilizing Role of Cash for Societies, IMFS Working Papers, No. 167.  Google Scholar
  103. Rösl, G./Seitz, F./Tödter, K.-H. (2019): The Cost of Overcoming the Zero Lower-Bound: A Welfare Analysis, Economies Vol. 7(67), 1–18.  Google Scholar
  104. Rua, A. (2021): Modelling Currency Demand: The case of the euro, Empirical Economics, Vol. 61, 1865–1881.  Google Scholar
  105. Sands, P. (2016): Making it Harder for the Bad Guys: The case for eliminating high denomination notes, m-rcbg Associate Working Paper Series No 52, Cambridge: Harvard Kennedy School.  Google Scholar
  106. Scheiber, T./Stern, C. (2016): Currency Substitution in CESEE: Why do households prefer euro payments? Oesterreichische Nationalbank (ed.), Focus on European Economic Integration, No. 4, 73–98.  Google Scholar
  107. Scheiber, T./Stix, H. (2009): Euroization in Central, Eastern and Southeastern Europe: New evidence on its extent and some evidence on its causes, Working Paper, No. 159, Oesterreichische Nationalbank.  Google Scholar
  108. Seitz, F./Devigne, L./de Pastor, R. (2022): Different Motives for Holding Cash in France: An Analysis of the Net Cash Issues of the Banque de France, Banque de France Working paper 888, October.  Google Scholar
  109. Zamora-Pérez, A. (2021): The Paradox of Banknotes: Understanding the demand for cash beyond transactional use, European Central Bank, Economic Bulletin 2/2021, 121–137.  Google Scholar
  110. Zamora-Pérez, A./Coschignano, E./Barreiro, L. (2022): Ensuring Adoption of Central Bank Digital Currencies – An easy task or a Gordian knot?, ECB Occasional Paper Series No 307, October.  Google Scholar
  111. Abramova, S./Böhme, R./Elsinger, H./Stix, H./Summer, M. (2022): What can CBDC Designers Learn from Asking Potential Users? Results from a survey of Austrian residents, OeNB Working Paper, 241.  Google Scholar
  112. Adalid, R./Álvarez-Blázquez, A./Assenmacher, K./Burlon, L./Dimou, M./López-Quiles, C./Fuentes, N. M./Meller, B./Muñoz, M.A./Radulova, P./Rodriguez d’Acri, C./Shakir, T./Šílová, G./Soons, O./Ventula Veghazy, A. (2022): Central Bank Digital Currency and Bank Intermediation: Exploring different approaches for assessing the effects of a digital euro on euro area banks, ECB Occasional Paper No 293, May.  Google Scholar
  113. Adams, J. (2006): The War on Cash, European Card Review, March/April, 12–18.  Google Scholar
  114. Ahnert, T./Assenmacher, K./Hoffmann, P./Leonello, A./Monnet, C./Porcellacchia, D. (2022): The Eonomics of Central Bank Digital Currency, ECB Working Paper Series, No 2713, August.  Google Scholar
  115. Ahnert, T./Hoffmann, P./Monnet, C. (2022): The Digital Economy, Privacy, and CBDC, ECB Working Paper Series, No 2662, May.  Google Scholar
  116. Amromin G./Chakravorti, S. (2009): Whither Loose Change? The Diminishing Demand for Small-Denomination Currency, Journal of Money, Credit and Banking, Vol. 41(2–3), 315–335.  Google Scholar
  117. Ardizzi, G./Nobili, A./Rocco, G. (2020): A Game Changer in Payment Habits: Evidence from daily data during a pandemic, Banca d’Italia, Occasional Paper, No 591, December.  Google Scholar
  118. Auer, R./Böhme R. (2020): The Technology of Retail Central Bank Digital Currency, BIS Quarterly Review, March, 85–100.  Google Scholar
  119. Barontini, C./Holden, H. (2019): Proceeding with Caution: A Survey on Central Bank Digital Currency, BIS Papers, No 101, February.  Google Scholar
  120. Bartzsch, N./Rösl, G./Seitz, F. (2011): Foreign Demand for Euro Banknotes Issued in Germany: Estimation using direct approaches, Deutsche Bundesbank Discussion Paper, Series 1: Economic Studies (20/2011).  Google Scholar
  121. Bechtel, A./Otto-Schleicher, D. (2021): Possible Characteristics of a TIPS-Based Digital Euro, EU Blockchain: Observatory and Form.  Google Scholar
  122. Bindseil, U./Panetta, F./Terol, I. (2021): Central Bank Digital Currency: Functional scope, pricing and controls, ECB Occasional Paper No 286, December.  Google Scholar
  123. Boar, C./Wehrli, A. (2021): Ready, Steady, Go? Results of the third BIS survey on central bank digital currency, BIS Papers, No 114, January.  Google Scholar
  124. Brunnermeier, M. K./Niepelt, D. (2019): On the Equivalence of Private and Public Money, Journal of Monetary Economics, Vol. 106(C), 27–41.  Google Scholar
  125. Buiter, W./Rahbari, E. (2015): High Time to Get Low: Getting Rid of the Lower-bound on Nominal Interest Rates, Global Economics View, Citi Research, 9 April.  Google Scholar
  126. Deutsche Bundesbank (2021): What do Households in Germany Think about the Digital Euro? First results from surveys and interviews, Monthly report, October, 65–84.  Google Scholar
  127. Deutsche Bundesbank (2022a): Demand for Euro Banknotes issued by the Bundesbank: Current developments, Monthly Report, April, 67–83.  Google Scholar
  128. Deutsche Bundesbank (2022b): Payment Behaviour in Germany in 2021.  Google Scholar
  129. Esselink, H./Hernandez, L. (2017): The Use of Cash by Households in the Euro Area, ECB Occasional Paper No. 201, November.  Google Scholar
  130. EU-Commission (2017): Proposal for an EU Initiative on Restrictions on Payments in Cash, 23.1.2017, European Commission, Brussels.  Google Scholar
  131. EU-Commission (2018): Report from the Commission to the European Parliament and the Council on Restrictions on Payments in Cash, 12.6.2018.  Google Scholar
  132. European Central Bank (2000): Issues Arising from the Emergence of Electronic Money, Monthly Report, November, 49–60.  Google Scholar
  133. European Central Bank (2016): ECB Ends Production and Issuance of € 500 Banknote, press release, 4 May.  Google Scholar
  134. European Central Bank (2019): In Focus: Exploring anonymity in central bank digital currencies, No 4, December.  Google Scholar
  135. European Central Bank (2020a): Report on a Digital Euro, October.  Google Scholar
  136. European Central Bank (2020b): Study on the Payment Attitudes of Consumers in the Euro Area (SPACE), December.  Google Scholar
  137. European Central Bank (2021a): Digital Euro Experimentation Scope and Key Learnings.  Google Scholar
  138. European Central Bank (2021b): Eurosystem Launches Digital Euro Project, press release,14 July 2021.  Google Scholar
  139. European Central Bank (2022a): Annual Accounts of the ECB for 2021.  Google Scholar
  140. European Central Bank (2022b): The Case for a Digital Euro: Key objectives and design considerations, July.  Google Scholar
  141. Hauser, A. (2022): Old Dogs, New Tricks: Adapting central bank balance sheets to a world of digital currencies, remarks given at Federal Reserve Bank of New York and Columbia SIPA workshop on ‘Monetary Policy Implementation and Digital Innovation’, 1 June 2022.  Google Scholar
  142. Jonker, N./van der Cruijsen, C./Bijlsma, M./Bolt, W. (2022): Pandemic Payment Patterns, Journal of Banking and Finance, Vol. 143, 106593.  Google Scholar
  143. Kantar Public (2022): Study on New Digital Payment Methods, Study commissioned by the European Central Bank, March.  Google Scholar
  144. Keister, T./Monnet, C. (2022): Central Bank Digital Currency: Stability and information, Study Center Gerzensee, Working Paper 22.03, May.  Google Scholar
  145. Kosse, A./Mattei, I. (2022): Gaining Momentum: Results of the 2021 BIS survey on central bank digital currencies, BIS Papers No. 125, May.  Google Scholar
  146. Kovacs, S./Rieg, J./Welz, M. (2014): Internet Payment Methods: Regulatory requirements for payment services and the e-money business, Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin).  Google Scholar
  147. Krüger, M./Seitz, F. (2017): The Benefits of Cash (Module 2), Fritz Knapp Publisher, Frankfurt/Main.  Google Scholar
  148. Lalouette, L./Esselink, H. (2018): Trends and Developments in the Use of Euro Cash over the Past ten Years, European Central Bank, Economic Bulletin, Vol. 6, 87–109.  Google Scholar
  149. Lalouette, L./Zamora-Pérez, A./Rusu, C./Bartzsch, N./Politronacci, E./Delmas, M./Rua, A./Brandi, M./Naksi, M. (2021): Foreign demand for euro banknotes, Occasional Paper Series, No. 253, European Central Bank, Frankfurt am Main, January.  Google Scholar
  150. Mersch, Y. (2016): Bares bleibt Wahres, Gastbeitrag, Spiegel Online, 5 May 2016,  Google Scholar
  151. Nivette, A./Zahnow, R./Aguilar R./Ahven, A./Amram, S./Ariel, B./Arosemena-Burbano, M. J./Baier, D./Bark, H.-M./Beijers, J. E. H./Ber, M. (2021): A Global Analysis of the Impact of COVID-19 stay-at-home Restrictions on Crime, Nature Human Behaviour, Vol. 5, 868–877.  Google Scholar
  152. Panetta, F. (2022a): Bringing European Payments to the Next Stage: A public-private endeavour, Keynote speech at the European Payments Council’s 20th anniversary conference, Frankfurt am Main, 16 June 2022.  Google Scholar
  153. Panetta, F. (2022b): The Digital Euro and the Evolution of the Financial System. Introductory statement at the Committee on Economic and Monetary Affairs of the European Parliament, Brussels, 15 June.  Google Scholar
  154. Panetta, F. (2022c): A Digital Euro that Serves the Needs of the Public: Striking the right balance, Introductory statement at the Committee on Economic and Monetary Affairs of the European Parliament, Brussels, 30 March.  Google Scholar
  155. Rogoff, K. S. (2016): The Curse of Cash, Princeton University Press, Princeton and Oxford.  Google Scholar
  156. Rösl, G./Seitz, F. (2022a): Cash Demand in Times of Crisis, Journal of Payment Systems & Strategies, Vol. 16(2).  Google Scholar
  157. Rösl, G./Seitz, F. (2022b): On the Stabilizing Role of Cash for Societies, IMFS Working Papers, No. 167.  Google Scholar
  158. Rösl, G./Seitz, F./Tödter, K.-H. (2019): The Cost of Overcoming the Zero Lower-Bound: A Welfare Analysis, Economies Vol. 7(67), 1–18.  Google Scholar
  159. Rua, A. (2021): Modelling Currency Demand: The case of the euro, Empirical Economics, Vol. 61, 1865–1881.  Google Scholar
  160. Sands, P. (2016): Making it Harder for the Bad Guys: The case for eliminating high denomination notes, m-rcbg Associate Working Paper Series No 52, Cambridge: Harvard Kennedy School.  Google Scholar
  161. Scheiber, T./Stern, C. (2016): Currency Substitution in CESEE: Why do households prefer euro payments? Oesterreichische Nationalbank (ed.), Focus on European Economic Integration, No. 4, 73–98.  Google Scholar
  162. Scheiber, T./Stix, H. (2009): Euroization in Central, Eastern and Southeastern Europe: New evidence on its extent and some evidence on its causes, Working Paper, No. 159, Oesterreichische Nationalbank.  Google Scholar
  163. Seitz, F./Devigne, L./de Pastor, R. (2022): Different Motives for Holding Cash in France: An Analysis of the Net Cash Issues of the Banque de France, Banque de France Working paper 888, October.  Google Scholar
  164. Zamora-Pérez, A. (2021): The Paradox of Banknotes: Understanding the demand for cash beyond transactional use, European Central Bank, Economic Bulletin 2/2021, 121–137.  Google Scholar
  165. Zamora-Pérez, A./Coschignano, E./Barreiro, L. (2022): Ensuring Adoption of Central Bank Digital Currencies – An easy task or a Gordian knot?, ECB Occasional Paper Series No 307, October.  Google Scholar
  166. Abramova, S./Böhme, R./Elsinger, H./Stix, H./Summer, M. (2022): What can CBDC Designers Learn from Asking Potential Users? Results from a survey of Austrian residents, OeNB Working Paper, 241.  Google Scholar
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  172. Ardizzi, G./Nobili, A./Rocco, G. (2020): A Game Changer in Payment Habits: Evidence from daily data during a pandemic, Banca d’Italia, Occasional Paper, No 591, December.  Google Scholar
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  175. Bartzsch, N./Rösl, G./Seitz, F. (2011): Foreign Demand for Euro Banknotes Issued in Germany: Estimation using direct approaches, Deutsche Bundesbank Discussion Paper, Series 1: Economic Studies (20/2011).  Google Scholar
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  182. Deutsche Bundesbank (2022a): Demand for Euro Banknotes issued by the Bundesbank: Current developments, Monthly Report, April, 67–83.  Google Scholar
  183. Deutsche Bundesbank (2022b): Payment Behaviour in Germany in 2021.  Google Scholar
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  188. European Central Bank (2016): ECB Ends Production and Issuance of € 500 Banknote, press release, 4 May.  Google Scholar
  189. European Central Bank (2019): In Focus: Exploring anonymity in central bank digital currencies, No 4, December.  Google Scholar
  190. European Central Bank (2020a): Report on a Digital Euro, October.  Google Scholar
  191. European Central Bank (2020b): Study on the Payment Attitudes of Consumers in the Euro Area (SPACE), December.  Google Scholar
  192. European Central Bank (2021a): Digital Euro Experimentation Scope and Key Learnings.  Google Scholar
  193. European Central Bank (2021b): Eurosystem Launches Digital Euro Project, press release,14 July 2021.  Google Scholar
  194. European Central Bank (2022a): Annual Accounts of the ECB for 2021.  Google Scholar
  195. European Central Bank (2022b): The Case for a Digital Euro: Key objectives and design considerations, July.  Google Scholar
  196. Hauser, A. (2022): Old Dogs, New Tricks: Adapting central bank balance sheets to a world of digital currencies, remarks given at Federal Reserve Bank of New York and Columbia SIPA workshop on ‘Monetary Policy Implementation and Digital Innovation’, 1 June 2022.  Google Scholar
  197. Jonker, N./van der Cruijsen, C./Bijlsma, M./Bolt, W. (2022): Pandemic Payment Patterns, Journal of Banking and Finance, Vol. 143, 106593.  Google Scholar
  198. Kantar Public (2022): Study on New Digital Payment Methods, Study commissioned by the European Central Bank, March.  Google Scholar
  199. Keister, T./Monnet, C. (2022): Central Bank Digital Currency: Stability and information, Study Center Gerzensee, Working Paper 22.03, May.  Google Scholar
  200. Kosse, A./Mattei, I. (2022): Gaining Momentum: Results of the 2021 BIS survey on central bank digital currencies, BIS Papers No. 125, May.  Google Scholar
  201. Kovacs, S./Rieg, J./Welz, M. (2014): Internet Payment Methods: Regulatory requirements for payment services and the e-money business, Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin).  Google Scholar
  202. Krüger, M./Seitz, F. (2017): The Benefits of Cash (Module 2), Fritz Knapp Publisher, Frankfurt/Main.  Google Scholar
  203. Lalouette, L./Esselink, H. (2018): Trends and Developments in the Use of Euro Cash over the Past ten Years, European Central Bank, Economic Bulletin, Vol. 6, 87–109.  Google Scholar
  204. Lalouette, L./Zamora-Pérez, A./Rusu, C./Bartzsch, N./Politronacci, E./Delmas, M./Rua, A./Brandi, M./Naksi, M. (2021): Foreign demand for euro banknotes, Occasional Paper Series, No. 253, European Central Bank, Frankfurt am Main, January.  Google Scholar
  205. Mersch, Y. (2016): Bares bleibt Wahres, Gastbeitrag, Spiegel Online, 5 May 2016,  Google Scholar
  206. Nivette, A./Zahnow, R./Aguilar R./Ahven, A./Amram, S./Ariel, B./Arosemena-Burbano, M. J./Baier, D./Bark, H.-M./Beijers, J. E. H./Ber, M. (2021): A Global Analysis of the Impact of COVID-19 stay-at-home Restrictions on Crime, Nature Human Behaviour, Vol. 5, 868–877.  Google Scholar
  207. Panetta, F. (2022a): Bringing European Payments to the Next Stage: A public-private endeavour, Keynote speech at the European Payments Council’s 20th anniversary conference, Frankfurt am Main, 16 June 2022.  Google Scholar
  208. Panetta, F. (2022b): The Digital Euro and the Evolution of the Financial System. Introductory statement at the Committee on Economic and Monetary Affairs of the European Parliament, Brussels, 15 June.  Google Scholar
  209. Panetta, F. (2022c): A Digital Euro that Serves the Needs of the Public: Striking the right balance, Introductory statement at the Committee on Economic and Monetary Affairs of the European Parliament, Brussels, 30 March.  Google Scholar
  210. Rogoff, K. S. (2016): The Curse of Cash, Princeton University Press, Princeton and Oxford.  Google Scholar
  211. Rösl, G./Seitz, F. (2022a): Cash Demand in Times of Crisis, Journal of Payment Systems & Strategies, Vol. 16(2).  Google Scholar
  212. Rösl, G./Seitz, F. (2022b): On the Stabilizing Role of Cash for Societies, IMFS Working Papers, No. 167.  Google Scholar
  213. Rösl, G./Seitz, F./Tödter, K.-H. (2019): The Cost of Overcoming the Zero Lower-Bound: A Welfare Analysis, Economies Vol. 7(67), 1–18.  Google Scholar
  214. Rua, A. (2021): Modelling Currency Demand: The case of the euro, Empirical Economics, Vol. 61, 1865–1881.  Google Scholar
  215. Sands, P. (2016): Making it Harder for the Bad Guys: The case for eliminating high denomination notes, m-rcbg Associate Working Paper Series No 52, Cambridge: Harvard Kennedy School.  Google Scholar
  216. Scheiber, T./Stern, C. (2016): Currency Substitution in CESEE: Why do households prefer euro payments? Oesterreichische Nationalbank (ed.), Focus on European Economic Integration, No. 4, 73–98.  Google Scholar
  217. Scheiber, T./Stix, H. (2009): Euroization in Central, Eastern and Southeastern Europe: New evidence on its extent and some evidence on its causes, Working Paper, No. 159, Oesterreichische Nationalbank.  Google Scholar
  218. Seitz, F./Devigne, L./de Pastor, R. (2022): Different Motives for Holding Cash in France: An Analysis of the Net Cash Issues of the Banque de France, Banque de France Working paper 888, October.  Google Scholar
  219. Zamora-Pérez, A. (2021): The Paradox of Banknotes: Understanding the demand for cash beyond transactional use, European Central Bank, Economic Bulletin 2/2021, 121–137.  Google Scholar
  220. Zamora-Pérez, A./Coschignano, E./Barreiro, L. (2022): Ensuring Adoption of Central Bank Digital Currencies – An easy task or a Gordian knot?, ECB Occasional Paper Series No 307, October.  Google Scholar
  221. Abramova, S./Böhme, R./Elsinger, H./Stix, H./Summer, M. (2022): What can CBDC Designers Learn from Asking Potential Users? Results from a survey of Austrian residents, OeNB Working Paper, 241.  Google Scholar
  222. Adalid, R./Álvarez-Blázquez, A./Assenmacher, K./Burlon, L./Dimou, M./López-Quiles, C./Fuentes, N. M./Meller, B./Muñoz, M.A./Radulova, P./Rodriguez d’Acri, C./Shakir, T./Šílová, G./Soons, O./Ventula Veghazy, A. (2022): Central Bank Digital Currency and Bank Intermediation: Exploring different approaches for assessing the effects of a digital euro on euro area banks, ECB Occasional Paper No 293, May.  Google Scholar
  223. Adams, J. (2006): The War on Cash, European Card Review, March/April, 12–18.  Google Scholar
  224. Ahnert, T./Assenmacher, K./Hoffmann, P./Leonello, A./Monnet, C./Porcellacchia, D. (2022): The Eonomics of Central Bank Digital Currency, ECB Working Paper Series, No 2713, August.  Google Scholar
  225. Ahnert, T./Hoffmann, P./Monnet, C. (2022): The Digital Economy, Privacy, and CBDC, ECB Working Paper Series, No 2662, May.  Google Scholar
  226. Amromin G./Chakravorti, S. (2009): Whither Loose Change? The Diminishing Demand for Small-Denomination Currency, Journal of Money, Credit and Banking, Vol. 41(2–3), 315–335.  Google Scholar
  227. Ardizzi, G./Nobili, A./Rocco, G. (2020): A Game Changer in Payment Habits: Evidence from daily data during a pandemic, Banca d’Italia, Occasional Paper, No 591, December.  Google Scholar
  228. Auer, R./Böhme R. (2020): The Technology of Retail Central Bank Digital Currency, BIS Quarterly Review, March, 85–100.  Google Scholar
  229. Barontini, C./Holden, H. (2019): Proceeding with Caution: A Survey on Central Bank Digital Currency, BIS Papers, No 101, February.  Google Scholar
  230. Bartzsch, N./Rösl, G./Seitz, F. (2011): Foreign Demand for Euro Banknotes Issued in Germany: Estimation using direct approaches, Deutsche Bundesbank Discussion Paper, Series 1: Economic Studies (20/2011).  Google Scholar
  231. Bechtel, A./Otto-Schleicher, D. (2021): Possible Characteristics of a TIPS-Based Digital Euro, EU Blockchain: Observatory and Form.  Google Scholar
  232. Bindseil, U./Panetta, F./Terol, I. (2021): Central Bank Digital Currency: Functional scope, pricing and controls, ECB Occasional Paper No 286, December.  Google Scholar
  233. Boar, C./Wehrli, A. (2021): Ready, Steady, Go? Results of the third BIS survey on central bank digital currency, BIS Papers, No 114, January.  Google Scholar
  234. Brunnermeier, M. K./Niepelt, D. (2019): On the Equivalence of Private and Public Money, Journal of Monetary Economics, Vol. 106(C), 27–41.  Google Scholar
  235. Buiter, W./Rahbari, E. (2015): High Time to Get Low: Getting Rid of the Lower-bound on Nominal Interest Rates, Global Economics View, Citi Research, 9 April.  Google Scholar
  236. Deutsche Bundesbank (2021): What do Households in Germany Think about the Digital Euro? First results from surveys and interviews, Monthly report, October, 65–84.  Google Scholar
  237. Deutsche Bundesbank (2022a): Demand for Euro Banknotes issued by the Bundesbank: Current developments, Monthly Report, April, 67–83.  Google Scholar
  238. Deutsche Bundesbank (2022b): Payment Behaviour in Germany in 2021.  Google Scholar
  239. Esselink, H./Hernandez, L. (2017): The Use of Cash by Households in the Euro Area, ECB Occasional Paper No. 201, November.  Google Scholar
  240. EU-Commission (2017): Proposal for an EU Initiative on Restrictions on Payments in Cash, 23.1.2017, European Commission, Brussels.  Google Scholar
  241. EU-Commission (2018): Report from the Commission to the European Parliament and the Council on Restrictions on Payments in Cash, 12.6.2018.  Google Scholar
  242. European Central Bank (2000): Issues Arising from the Emergence of Electronic Money, Monthly Report, November, 49–60.  Google Scholar
  243. European Central Bank (2016): ECB Ends Production and Issuance of € 500 Banknote, press release, 4 May.  Google Scholar
  244. European Central Bank (2019): In Focus: Exploring anonymity in central bank digital currencies, No 4, December.  Google Scholar
  245. European Central Bank (2020a): Report on a Digital Euro, October.  Google Scholar
  246. European Central Bank (2020b): Study on the Payment Attitudes of Consumers in the Euro Area (SPACE), December.  Google Scholar
  247. European Central Bank (2021a): Digital Euro Experimentation Scope and Key Learnings.  Google Scholar
  248. European Central Bank (2021b): Eurosystem Launches Digital Euro Project, press release,14 July 2021.  Google Scholar
  249. European Central Bank (2022a): Annual Accounts of the ECB for 2021.  Google Scholar
  250. European Central Bank (2022b): The Case for a Digital Euro: Key objectives and design considerations, July.  Google Scholar
  251. Hauser, A. (2022): Old Dogs, New Tricks: Adapting central bank balance sheets to a world of digital currencies, remarks given at Federal Reserve Bank of New York and Columbia SIPA workshop on ‘Monetary Policy Implementation and Digital Innovation’, 1 June 2022.  Google Scholar
  252. Jonker, N./van der Cruijsen, C./Bijlsma, M./Bolt, W. (2022): Pandemic Payment Patterns, Journal of Banking and Finance, Vol. 143, 106593.  Google Scholar
  253. Kantar Public (2022): Study on New Digital Payment Methods, Study commissioned by the European Central Bank, March.  Google Scholar
  254. Keister, T./Monnet, C. (2022): Central Bank Digital Currency: Stability and information, Study Center Gerzensee, Working Paper 22.03, May.  Google Scholar
  255. Kosse, A./Mattei, I. (2022): Gaining Momentum: Results of the 2021 BIS survey on central bank digital currencies, BIS Papers No. 125, May.  Google Scholar
  256. Kovacs, S./Rieg, J./Welz, M. (2014): Internet Payment Methods: Regulatory requirements for payment services and the e-money business, Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin).  Google Scholar
  257. Krüger, M./Seitz, F. (2017): The Benefits of Cash (Module 2), Fritz Knapp Publisher, Frankfurt/Main.  Google Scholar
  258. Lalouette, L./Esselink, H. (2018): Trends and Developments in the Use of Euro Cash over the Past ten Years, European Central Bank, Economic Bulletin, Vol. 6, 87–109.  Google Scholar
  259. Lalouette, L./Zamora-Pérez, A./Rusu, C./Bartzsch, N./Politronacci, E./Delmas, M./Rua, A./Brandi, M./Naksi, M. (2021): Foreign demand for euro banknotes, Occasional Paper Series, No. 253, European Central Bank, Frankfurt am Main, January.  Google Scholar
  260. Mersch, Y. (2016): Bares bleibt Wahres, Gastbeitrag, Spiegel Online, 5 May 2016,  Google Scholar
  261. Nivette, A./Zahnow, R./Aguilar R./Ahven, A./Amram, S./Ariel, B./Arosemena-Burbano, M. J./Baier, D./Bark, H.-M./Beijers, J. E. H./Ber, M. (2021): A Global Analysis of the Impact of COVID-19 stay-at-home Restrictions on Crime, Nature Human Behaviour, Vol. 5, 868–877.  Google Scholar
  262. Panetta, F. (2022a): Bringing European Payments to the Next Stage: A public-private endeavour, Keynote speech at the European Payments Council’s 20th anniversary conference, Frankfurt am Main, 16 June 2022.  Google Scholar
  263. Panetta, F. (2022b): The Digital Euro and the Evolution of the Financial System. Introductory statement at the Committee on Economic and Monetary Affairs of the European Parliament, Brussels, 15 June.  Google Scholar
  264. Panetta, F. (2022c): A Digital Euro that Serves the Needs of the Public: Striking the right balance, Introductory statement at the Committee on Economic and Monetary Affairs of the European Parliament, Brussels, 30 March.  Google Scholar
  265. Rogoff, K. S. (2016): The Curse of Cash, Princeton University Press, Princeton and Oxford.  Google Scholar
  266. Rösl, G./Seitz, F. (2022a): Cash Demand in Times of Crisis, Journal of Payment Systems & Strategies, Vol. 16(2).  Google Scholar
  267. Rösl, G./Seitz, F. (2022b): On the Stabilizing Role of Cash for Societies, IMFS Working Papers, No. 167.  Google Scholar
  268. Rösl, G./Seitz, F./Tödter, K.-H. (2019): The Cost of Overcoming the Zero Lower-Bound: A Welfare Analysis, Economies Vol. 7(67), 1–18.  Google Scholar
  269. Rua, A. (2021): Modelling Currency Demand: The case of the euro, Empirical Economics, Vol. 61, 1865–1881.  Google Scholar
  270. Sands, P. (2016): Making it Harder for the Bad Guys: The case for eliminating high denomination notes, m-rcbg Associate Working Paper Series No 52, Cambridge: Harvard Kennedy School.  Google Scholar
  271. Scheiber, T./Stern, C. (2016): Currency Substitution in CESEE: Why do households prefer euro payments? Oesterreichische Nationalbank (ed.), Focus on European Economic Integration, No. 4, 73–98.  Google Scholar
  272. Scheiber, T./Stix, H. (2009): Euroization in Central, Eastern and Southeastern Europe: New evidence on its extent and some evidence on its causes, Working Paper, No. 159, Oesterreichische Nationalbank.  Google Scholar
  273. Seitz, F./Devigne, L./de Pastor, R. (2022): Different Motives for Holding Cash in France: An Analysis of the Net Cash Issues of the Banque de France, Banque de France Working paper 888, October.  Google Scholar
  274. Zamora-Pérez, A. (2021): The Paradox of Banknotes: Understanding the demand for cash beyond transactional use, European Central Bank, Economic Bulletin 2/2021, 121–137.  Google Scholar
  275. Zamora-Pérez, A./Coschignano, E./Barreiro, L. (2022): Ensuring Adoption of Central Bank Digital Currencies – An easy task or a Gordian knot?, ECB Occasional Paper Series No 307, October.  Google Scholar

Abstract

The present paper provides an overview on current developments of cash usage and issue of central bank digital currency (CBDC) in the euro area and proposes a possible design of a digital euro that allows for instant offline payments. Cash usage at the point-of-sale decreased perceptibly in the past years mainly due to the ongoing trend towards digitalization. However, we show that there are also indications that consumers were somewhat pushed into cashless payments by government regulations and supply-side restrictions by commercial banks. Nonetheless, overall demand for euro cash remained strong and even increased relative to GDP since the financial crisis in 2008. In this process, however, we observe a supply-driven shift towards lower banknote denominations. Central banks all over the world are intensively thinking about the potential issue of ­CBDC as a substitute or complement to cash. Based on some of its preferred characteristics, we propose a double pre-paid scheme combining central elements of TARGET Instant Payment Settlement and electronic money features enabling offline and online instant payments. Since anonymity is categorically discarded by the ECB and as cash has some special advantages from a consumer perspective, the digital euro will rather co-circulate with cash than replace it in transactions.

Table of Contents

Section Title Page Action Price
Gerhard Rösl / Franz Seitz: Central Bank Digital Currency and Cash in the Euro Area: Current Developments and one Specific Proposal 523
Abstract 523
I. Introduction 523
II. Categorization of Different Types of Money in the Euro Area 524
III. Cash Supply and Demand in the Euro Area 527
1. Anti-Cash-Cartel in the EU? 527
2. Cash Usage at the Point of Sale 530
3. Total Cash in Circulation 532
4. Demand Shift towards Lower Denominations 534
5. Foreign Demand for Euro Banknotes 536
IV. The Digital Euro: Supply and Demand Side Considerations 536
1. Characteristics of the Digital Euro 536
2. A Novel Double Pre-Paid Design for the Digital Euro 538
a) E-Money in the Euro Area 538
b) TARGET Instant Payment Settlement 541
c) The Digital Euro: Combining TIPS with E-Money 543
3. Cash and the Digital Euro: Coexistence or Replacement? 545
V. Summary and Conclusions 546
References 548

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