FRANKFURT (Reuters), ECB Executive Board member Fabio Panetta stated that the European Central Bank should issue a virtual euro because giving away the space exclusively to private sector initiatives such as stablecoins can endanger financial security and weaken central banking’s role.

While the ECB has worked on a digital currency design, a claim directly on the central banks much as in the case for cash, the actual launch of a currency may take five years.

Panetta spoke in a speech Friday, saying that just as the postal stamp has lost much of their utility with the introduction of the internet and email so could cash be less relevant in an increasingly digital economy.

“If such a scenario occurs, it will weaken central bank money’s effectiveness as a financial anchor.”

Although digital money issued by central banks could still go through traditional commercial banks, it would not be insured. It gives users an extra level of security that is not affected by individual payment service providers or lenders.

Panetta, however, rejected Panetta’s argument that stablecoins from the private sector – which is a cryptocurrency that is usually tied to a currency in order to maintain its value – would render digital central bank money redundant as these private efforts carry an inherent risk and are frequently amplified during times of crisis.

He stated that history has shown that public trust and financial stability require both public money and private money.

It is essential that digital money from the central bank be used widely so that people know it exists.

A digital euro must be made attractive enough that it can be used widely as a method of payment but not too successful to become a valuable store of wealth that it overtakes private money, increasing the chance of bank runs,” he said.