One day we will likely look back and try to identify the moment when currencies were on a definitive path to become entirely digital. One possible defining moment will be when central bankers felt it was more the norm to prepare for digital currencies than not. Bank of France Governor Francois Villeroy de Galhau is right to feel the pressure on being prepared to launch a Central Bank Digital Currency (CBDC). But his suggestion that there will be no impact on banks seems a bit insincere. If all our currency were digital today, how would you differentiate between what is in your ‘wallet’ and what is in your checking account? The answer to that question will have to come from banks and it likely won’t have the words ‘0% interest’ in them.
