European Central Bank is testing its own cryptocurrency. What can we do with such a digital euro?

The headquarters of the European Central Bank in Frankfurt. The bank plans to come up with a new digital currency. We are one step closer to a new legal tender: the digital euro. The European Central Bank expects to have the currency ready for use in five years.

Digital coins

Digital coins? Yes, you have bitcoin, other cryptocurrencies and tech giant Facebook’s plans with its Libra. And another is coming. From the European Central Bank (ECB). The bank will start a test for a ‘digital euro’, it announced on Wednesday. As it stands now, the new currency will be ready for use by Europeans in 2026. Tradingview has risen.

The digital euro? “It’s a bit of a vague name,” notes ING digital currency specialist Teunis Brosens. “I think I have been paying with a digital euro for years, namely through my bank. ”His response reflects precisely that there are still many questions about the ECB project. What are they going to test? What will the actual introduction depend on? And: what exactly is such a digital currency? In order not to lapse into technical jargon: citizens will soon notice hardly any difference in user-friendliness between online banking at a bank and banking at the ECB. At least, as the plan stands now, Brosens says.

In fact, the ECB will not distribute the new currency itself. She leaves that to the banks in Europe. The ECB still has to set up an entire banking organization, from customer service to a fraud desk. Certainly no mean feat, while banks have had that organization for a long time. So citizens will soon be able to open an account with the ECB, which they can then use at their regular bank. Then they can also find an ECB account in their telephone under their checking and savings accounts. Another currency, yes, but you don’t notice it much, says Brosens. It is not yet clear whether using the account, such as transferring money, also works the same as with a regular account.

Direct link between bank and citizen

The digital euro is not the same as a crypto currency such as bitcoin. There are technical differences. But the main difference is that the digital euro is issued and managed by a central bank. To understand why the ECB is betting on the digital currency, we have to go back to cash: notes. Governments guarantee the value of the money that we withdraw from the ATM and have in our hands: a safe means of payment. But we withdraw less and less money. We bank digitally, with commercial banks that also manage that money. Enjin coin is well known in crypto.

Risks are small. The chance that a bank will fail is not great, moreover, central banks themselves supervise. “It’s about the principle that the ECB likes to maintain a direct link with citizens for spending money,” says Brosens. In addition, China is testing its own digital currency. The British and American central banks are also investigating the possibilities. Then Europe cannot stay behind, is the argument.

The project only gained momentum two years ago when Facebook unveiled plans for its own digital currency, separate from governments and banks: the Libra. Then all the alarm bells went off, Leave a new form of payment to big tech? That is not possible, they think. For various reasons, the Libra (now called Diem by the way) does not yet have a license to act as a currency.

Is there something wrong with the current system? Why would a European open an ECB account if he already has a bank account? It seems too early for that question. The project is still too abstract for that. But it’s pretty certain that the currency will come soon, thinks Brosens.

Bitcoin & Ethereum continue to fall, worries about death cross, these prices rise & fall the most

A real recovery from the dip of the day before yesterday is yet to come, most cryptocurrency prices corrected further down yesterday afternoon and last night. At the beginning of the week, there still seemed to be a trend reversal, but little of that is now left.

The market seems to be cooling down further and without increasing trading volumes, unfortunately we may be stuck in the current range for a while longer before seeing a major breakout. Total market capitalization is down to about $1.62 trillion today. Crypto price is high.

Bitcoin (BTC)

Bitcoin (BTC) failed to hold out around $39,000 yesterday and plunged to $38,500 yesterday afternoon. At the beginning of the evening, there was an additional boost and the BTC price fell equally hard to $37,650. Bitcoin found support there and later recovered to $38,000, but that recovery was short-lived.

Overnight, and again this morning, bitcoin fell back to support around USD 37,500, which has proven to be a critical level in recent times. Bitcoin is again looking for a bottom, but whether it has found it is very questionable. Another key support zone is around $35,000.

Some analysts are talking about an imminent “death cross” as the 50-day and 200-day exponential moving average (EMA) crosses, but since we have already seen a significant decline in recent times, it is very questionable what the impact of this will be.

altcoins

Ethereum (ETH) fell again more than bitcoin yesterday, briefly reaching $2,300 early in the evening after falling more than 6%. The ether price briefly rose to USD 2,380 last night, but was unable to break through and stands at USD 2,340 this morning. Solana price is high.

Several altcoins are back in the red

Decentralized finance (DeFI) tokens like Aave (AAVE), Chainlink (LINK), Synthentix (SNX), and Sushi (SUSHI) are 6 to 8 percent in the red. Polkadot (DOT) loses 7.5% and little brother Kusama (KSM) 9.5%. Shiba Inu (SHIB) and Internet Computer (ICP) continue their correction, losing 8%. Enjin Coin (ENJ) takes another big hit and is 9% in the min. Quant (QNT) and Thorchain (RUNE), which rose well recently, are both 11% in the red today.

The biggest loser today is Amp (AMP). Amp has been rallying for the past few weeks, but also started falling sharply yesterday morning. The AMP price is no less than 27% in the red today.

Still, a few altcoins are also turning green today. Arweave (AR) is up 9%, Celo (CELO) is storming into the top 100 with an 11% increase, Theta Fuel (TFUEL) and Fantom (FTM) are up again, grabbing around 15%, but the biggest riser today is XinFin Network (XDC) which is up 17%.