Amazon has announced its collaboration with the European Central Bank (ECB) on its digital euro prototyping exercise. This news comes in the wake of the ECB’s report detailing the outcomes of its prototyping exercise for the digital euro, which ran from July 2022 to February 2023.
The ECB’s exercise aimed to test how design choices for the digital euro could be technically implemented and integrated into the existing European payments landscape. The findings confirmed that a digital euro could work both online and offline, using independent designs. This would increase the resilience of the digital euro, ensuring that central bank money remains accessible in the digital age.
Amazon’s participation in this exercise was focused on delivering a front-end prototype of an e-commerce transaction and integrating it with the Eurosystem’s back-end infrastructure prototype. This successful integration confirmed that a potential digital euro could be smoothly integrated into the existing European payments landscape.
Amazon’s involvement in this project underscores its commitment to fostering innovation and increasing the efficiency of payments. The company believes that a digital euro can be a tool to enhance these aspects. Amazon’s customer-centric approach aims to maximize convenience, speed, and security, which aligns with the objectives of the digital euro project.
The e-commerce giant’s participation in the project also highlights its commitment to Europe. Amazon directly employs more than 200,000 people across the continent, supports 225,000 European small and medium enterprises through its stores, and has spent €142 billion to grow Amazon across the EU since 2010.
The ECB’s prototyping exercise included the development of a single back-end – a settlement engine – designed by the Eurosystem, and five different front-end prototypes – user interfaces. The back-end prototype was not intended to be the final design, but was an experimental version to test and to learn from. The front-end prototypes were presented by private companies selected following a public call for expressions of interest.
The ECB’s report provides suggestions for further exploratory work, such as evaluating performance optimization options and alternative technologies. Additional prototyping work could explore technical alternatives for later design decisions that could not be included in the scope of this exercise, such as the set-up for cross-currency payments, dispute management, and fraud management.
In conclusion, Amazon’s collaboration with the ECB on the digital euro prototyping exercise marks a significant step towards the integration of digital currencies into the e-commerce landscape. As the ECB continues its investigation phase of the digital euro project, the involvement of major e-commerce players like Amazon could provide valuable insights and expertise, potentially shaping the future of digital payments in Europe.
Featured Image Credit: Photo / illustration by “Ibrahim Boran” via Unsplash
