CBDC and Stablecoins in the Eurozone: How Do They Affect Banking?

This article aims to reread the debate on the effects of the introduction of a retail central bank digital currency on the financial structure and in particular on the possible disintermediation of banks taking into account the institutional characteristics of the euro area and their repercussions on monetary and financial markets. These characteristics are the lack of a common fiscal authority, the fragmentation of money and government bonds markets, and the lack of a common safe asset. Two scenarios are examined. In the former, CBDC is introduced without limits. This could exacerbate the asymmetry in monetary policy transmission by causing a higher cost of credit in peripheral countries, especially in the event of a return to monetary policy without ample reserves. The second scenario, on the other hand, which involves limits on both holding and access, could avoid competition between bank deposits and CBDCs, but could not avoid competition between CBDCs and stablecoins. The latter, due to the legislation introduced (MiCAR), would have a place in the hierarchy of money after insured deposits and before uninsured ones.