ECB: Digital euro could lead to up to €700 billion in deposit losses in case of bank runs
a simulation by the European Central Bank (ECB) on Friday showed that in the event of a run on commercial banks, digital euros could lead to as much as 700 billion euros (approximately 810.88 billion US dollars) in deposits being transferred, causing liquidity constraints for around a dozen banks in the eurozone.
The study, mandated by European lawmakers, aims to assess the risks posed to the banking sector by digital currency (essentially an electronic wallet guaranteed by the ECB) in different scenarios, including the hypothetical "flight to safety" scenario.
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