The European Central Bank has released jaw-dropping calculations that could make bankers unnerved. In a document dated October 10, the ECB warns that in case of a financial panic, the introduction of a digital euro could lead to an outflow of up to €699 billion — or around $811 billion — from commercial banks in the eurozone. That is approximately 2.2% of the entire banking sector’s assets.
According to the ECB’s estimates, such a scenario could leave 13 out of 2,025 banks facing liquidity shortfalls. In other words, the situation is still under control, but the market is a bit noisier than usual.
The study outlines two potential scenarios: one where “all is calm” and another where “everyone runs.” In the latter case, even with a per-person cap of €3,000, depositors could theoretically withdraw roughly €700 billion, seeking digital safety much like people once fled to gold.
However, the ECB quickly notes that these figures are somewhat overstated: customers with multiple accounts would not be able to withdraw the maximum from each. Even panic has its limits.
According to the ECB, the main risk lies in deposits over €100,000 and corporate funds, which account for 31% of all demand deposits. Unsurprisingly, these clients appear to take diversification seriously, not just in theory.
Under calm conditions, the figures are far less dramatic: with a €500 cap, outflows are estimated at €156 billion, or 0.5% of banking assets. No catastrophe — more like a regular day in the age of financial digitalization.
Besides, the ECB projects that by 2034, the shift to a digital euro could result in €127 billion in additional deposits for banks, thanks to declining cash usage and the popularity of electronic payments.
The regulator emphasizes that holding limits on the digital euro are a tool for financial stability. Without them, even slight market jitters could spiral into a full-blown digital bank crash.
The document also highlights the risk of “digital dollarization.” If Europeans become too enamored with dollar-based stablecoins, the eurozone could wake up one day with a serious hangover: namely, the loss of monetary sovereignty.
A second ECB study, released on the same day, focused on costs. It estimates that implementing the digital euro would cost banks between €4 and €5.77 billion — or around €1 to €1.44 billion annually over four years.
Nevertheless, the ECB remains optimistic: shared IT infrastructure could reduce costs by 30%, and Intermediary Participation Schemes (IPS) might slash them by as much as 90–98%.
So, the digital euro may not be cheap, but it might whip accountancy into shape better than any auditor.
