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The role of cash between the digital euro and cryptocurrencies

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The role of cash between the digital euro and cryptocurrencies

by Antonio Staino *

While in Italy the ‘gift’ of the ceiling on cash payments, in the far Kazakhstan – the second largest cryptocurrency producing country in the world – long lines of people in front of ATMs attempting to withdraw cash.

An image that plastically expresses how cash remains there store of value privileged in emergency situations linked to factors of political and social instability, despite the rapidity with which the processes of dematerialization of the currency take place on a global level.
Other than the roller coaster we have become accustomed to cryptocurrencies with their extreme volatility! Financial analysts were quick to explain that the bearish pressure on cryptocurrencies was the result of the conjunction between the announced tapering of the American Fed, the tightening imposed by China on the so-called ‘mining’ and the aforementioned Kazakh energy crisis, but that the decentralized ‘crypto’ market was a risky speculative bet we had already understood, as it is not regulated by a central authority.

So it is sufficient to look at what happens in the rest of the world to understand what paroxysmal level it has reached demonization of cash in Italy. In our country, 2022 began with the introduction of the 1,000 euro ceiling imposed on cash payments. A very questionable measure considering that there are no such restrictions in other large European countries and that the ECB, in the Letter sent to the Italian Government during 2019, put the alleged objectives of combating tax evasion under the magnifying glass of the provision.

But the cash ceiling is not enough. From 2023 in Italy a further one is expected close with heavy fines to merchants who will not use ATMs and credit cards in their businesses. And all this after the unfortunate end of the State Cashback, a rule that has proved costly and “regressive”, in the words of President Draghi, ending up fueling social inequalities. The paradoxical thing is that while there is a tendency to target citizens who prefer to use cash by exercising their freedom of choice, no one seems to care that anyone who wants to can transfer value using the new digital platforms where cryptocurrencies are exchanged, accumulating non-profit profits. taxable by these negotiations …

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The good news is that Europe plans one new electronic money issued and regulated by the ECB, theDigital euro, which will be safer than private cryptocurrencies. This brings us to the third noteworthy event that occurred at the beginning of the year, the celebrations for the twentieth anniversary of the single currency.
Today the Euro is used by 340 million people and has allowed European countries to face the serious crises that have opened up in global financial capitalism, from subprime to sovereign debt to the economic pandemic, becoming the glue of our European identity.

That Europe now wants to equip itself with an electronic money can only strengthen the Union in the global digital challenge, but also in this case it must be said that the European financial institutions have stressed several times and at the highest levels that the digital Euro can be added. but don’t replace cash. On the other hand, the public consultation on the digital euro launched by the central bank last year leaves many questions open about how Europeans look at the transformation of their currency. A strong demand for privacy protection and cybersecurity has emerged.
We wonder whether with the digital euro anonymity in transactions will continue to be guaranteed as happens when we use cash, considering the fact that the tracking of digital operations will be allowed to combat organized crime and serious crimes such as money laundering. the result of illegal activities. Will our privacy be fully guaranteed? Likewise, European citizens are asking for more security in the face of the growing risk of cybercrime, cyber attacks and other technical problems linked to the change in the technological paradigm introduced by the cashless society.

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So then, even in Europe, people look realistically at digital transformation, considering that in the years of the pandemic – when new forms of electronic payments became more widespread – the demand for banknotes remained very strong.

More than 70% of transactions in the Old Continent continue to take place in cash. “Euro banknotes will always be part of our lives,” she said ECB president Lagarde, “They are a tangible and visible symbol of our cohesion in Europe. In particular in times of crisis “.
The clarity of this statement should make the standard bearers of the fight against cash in our house reflect. While in the Eldorado of cryptocurrencies the Kazakhs were trying to withdraw cash at ATMs, and while Europe planning the digital Euro announced the graphic restyling of our beloved banknotes (by 2024), yet another measure with a punitive and moralistic flavor came into force in Italy, to the detriment of those citizens who now can no longer even give a gift of more than a thousand euros to their children using cash.
As if to say, a foundation of European and Western economic history, cash, in our country is reduced to a synonym of malfeasance and corruption. All this appears profoundly senseless as well as demagogic.

* Antonio Staino is the President of Assovalori, the Association of Values ​​Transport in Italy.

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