Bank of Finland (BOF) aims to create a local instant payment solution that complies with European Union legal standards. Tuomas Valimaki, a member of the BOF board and a member of the European Central Bank (ECB) Governing Council, announced this decision to the public on October 19. The project, which will be inspired by blockchain technology, has taken its first steps and the preparation phase will last for two years.
A Local Payment System for Finland
Tuomas Valimaki stated that the Bank of Finland actively supports the development of new payment systems. The executive considered the central bank digital currency (CBDC) project, digital Euro, as the most innovative project in the payment sector operating in the European Union. Valimaki continued his statement as follows:
“The possible introduction of the digital Euro will offer consumers the option to make payments with central bank money wherever electronic payments are accepted.”
According to Valimaki, the Bank of Finland and the European Payments Council also want to create an instant payment solution project that will serve in Finland. This payment solution will be based on credit transfers and will not have a payment card infrastructure.
CBDC Projects in the Preparation Phase
In February 2023, the Finnish company Membrane Finance launched a stablecoin with a completely different design supported by the European Union fiat currency Euro. Juha Viitala, the CEO of Membrane Finance, stated that EUROe token, which is different from many stablecoin projects, will encourage more Europeans to grow their investments through decentralized finance (DeFi) platforms.
This week, the European Central Bank (ECB) Governing Council announced that the preparation phase for the digital euro project, which is a CBDC project, has begun. The preparation phase, including pilot tests, will last for two years, and the selection process for companies that will participate in the project will begin after the establishment of a legal regulatory framework for the cryptocurrency. The companies will assume the issuance task for the token.
While CBDC preparations continue at full speed in the European Union, these programs are also ongoing in many countries. Russia has made significant progress in its project, which it recently started pilot tests for, and the digital ruble will be launched in the near future.
