Amid an intensification in the European Union’s crypto-focused legislative efforts, the European Commission has launched a new consultation on its digital euro central bank digital currency (CBDC) project. The procedure will allow interested stakeholders who want to help shape a digital euro to voice their opinion to Brussels, with privacy concerns likely to rank as one of the leading topics.
In the document, the commission says that the collected responses to its consultation paper will provide valid guidance to EU decision-makers when potentially preparing a formal proposal on the digital euro. Opinions are to be submitted by June 14, 2022.
The paper says that,
“The introduction of a digital euro aims to preserve the role of public money in a digital economy. Preserving the accessibility and usability of central bank money in the digital era is key to protect monetary sovereignty and the well-tested two-layer monetary system based on convertibility of regulated/supervised forms of money into central bank money.”
Additionally, the Commission recognizes that the European Central Bank’s “public consultation on the digital euro indicated that future users of the digital euro see privacy as one of the most important elements.”
With this in mind, Fabio Panetta, Member of the Executive Board of the European Central Bank, stated last month that, with regards to the digital euro, “a greater degree of privacy could be considered for lower-value online and offline payments.”
Panetta said that,
“These payments could be subject to simplified AML/CFT checks, while higher-value transactions would remain subject to the standard controls.”
The commission said the consultation is carried out to gather further evidence on the following matters:
- users’ needs and expectations related to the digital euro;
- the digital euro’s role in retail payments in the EU and the digital economy;
- making the digital euro available for retail operations while continuing to safeguard the legal tender status of euro cash;
- the digital euro’s impact on the EU’s financial sector and financial stability;
- application of anti-money laundering (AML) and counter-terrorist financing (CTF) rules;
- the digital euro’s privacy and data protection aspects;
- international payments performed with the digital euro.