Digital Euro Holdings Shouldn't Be Capped, Study Says

The research, commissioned by the European Parliament, counters an argument that the currency should be used only for daily transactions, not as a source of savings.

AccessTimeIconApr 26, 2023 at 2:03 p.m. UTC
Updated Apr 26, 2023 at 3:14 p.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global event for everything crypto, blockchain and Web3.Register Now

A digital euro system shouldn’t limit users’ holdings, a paper produced for the European Parliament said, arguing that the risks to financial stability of people deserting conventional banks are overstated.

The paper turns on its head central bankers’ conventional wisdom that individuals shouldn’t be allowed more than a few thousand euros' worth of the central bank digital currency to prevent them from using it as a savings vehicle.

The banking industry issued a sigh of relief when Fabio Panetta, a member of the European Central Bank's board, said individual users of the digital currency would be limited to holding around 3,000 euros ($3,317) worth at a time because he wants the CBDC used only for day-to-day payments.

Panetta’s goals for the project are wrong, said the report produced by academic Christian Hofmann at the request of the European Parliament's Economic and Monetary Affairs Committee.

“The key role of a digital euro consists of the important role it can play as a store-of-value option for the public,” said Hofmann, who is an associate professor at the National University of Singapore. “All of this requires that the public’s access to a digital euro is unlimited.”

Even though the study doesn’t bind the parliament, some lawmakers are thinking on similar lines.

“I have strong doubts about the restrictions” on holdings, socialist Dutch lawmaker Paul Tang told the chamber in a debate last week, arguing the CBDC should compete with banks. “A digital euro should be viable – why use something you can hardly hold?”

Central bankers such as Panetta have warned that a mass exodus from commercial banks could choke lending and damage financial stability.

The ECB is due to decide later this year whether to continue with the digital euro project The Bank of England has said that holdings of its own digital pound could also be limited to 10,000 British pounds ($12,480).

Edited by Sheldon Reback.


Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

Jack Schickler

Jack Schickler was a CoinDesk reporter focused on crypto regulations, based in Brussels, Belgium. He doesn’t own any crypto.

Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to to register and buy your pass now.