Bank Of France To Test Digital Currency In 2020

The central bank of France is all set to test-run its digital currency in the first quarter of 2020, according to a cryptocurrency publication Cointelegraph.

What Happened

The governor of the Bank of France, François Villeroy de Galhau, said they would begin testing a central bank digital currency (CBDC) in the first quarter of 2020 as part of their digital euro project, according to a report published in Les Echos on Dec. 4.

This move could make France the first country to issue a CBDC. "I see the interest in rapidly advancing the issuance of at least one central bank digital currency in order to be the leading issuer globally and get the benefits associated with providing an exemplary central bank digital currency,” said François, according to a tweet by the Bank of France.

No Retail Payments

For now, only financial institutions in France will be allowed permission to use the proposed digital currency. Using a CBDC for retail payments could pose security risks, said the governor, according to the Les Echos report.

Why It Matters

The French Government earlier opposed the proposed launch of Facebook’s proposed cryptocurrency libra, arguing that it “would put the sovereignty of governments at risk,” according to CNBC.

The proposed digital currency launch should help France maintain its monetary sovereignty against private digital currency initiatives, said François.

Photo Credit: Guilhem Vellut via Wikimedia