Villeroy de Galhau, Governor of the Bank of France, said on Saturday that virtual currency can be useful especially when cash transactions are decreasing in various nations, however, it should be the prerogative of central banks to issue it and not private firms, Reuters reports.
In the wake of the popularity of cryptocurrencies as well as the anticipated Facebook led Libra stablecoin, most central banks around the world are now exploring ways they can introduce their own digital currencies to avert a possibility of losing their grip over money matters.
However, Villeroy said his comments are not inspired by Facebook’s Libra plans saying that it is a response to advancement in technology and the demand for digital money by various banks. He also added that soon people will start demanding an alternative to fiat money.
The governor who was speaking to France Inter Radio explained that some countries in Europe such as the Netherlands and Sweden are already experiencing a decrease in the use of fiat banknotes. In this case, there has been a debate on whether the central banks in Europe on whether to issue virtual currencies which have similar qualities like banknotes, notably central bank’s security.
The governor was asked if private firms can issue virtual currencies and he categorically stated that money can never be private. He added that money can be equated as a public good which guarantees a state of its sovereignty.
Villeroy revealed that plans are underway among different central banks to pilot digital currencies and the topic will be studied by the central banks within the eurozone.
France has been at the forefront in opposing the launching of Libra in Europe vowing that the stablecoin will never be allowed to operate in any European country. In the recent past, France Finance Minister has stated that Libra and other cryptocurrencies, if allowed to operate as currently designed, will rob nations of their financial sovereignty. France’s sentiments have also been echoed by Germany’s Finance minister.