European Central Bank: Digital Euro Could Trigger Deposit Outflows of Up to 700 Billion Euros During a Bank Run

Jinse Finance reported that a simulation by the European Central Bank (ECB) on Friday showed that, in the event of a bank run at commercial banks, the digital euro could lead to the transfer of up to 700 billion euros (approximately 81.088 billion USD) in deposits, causing liquidity tightening for about a dozen banks in the eurozone. This study, commissioned by European legislators, aims to assess the risks posed by digital currency (essentially an electronic wallet guaranteed by the ECB) to the banking sector under different scenarios, including a hypothetical "flight to safety" scenario.