An important step forward was taken earlier this year when the European Commission (EC) proposed a complete legislative framework to usher in a central bank digital currency (CBDC) among the Eurozone’s 20 member states.
With the introduction of the digital euro, which the European Central Bank (ECB) has said might happen as early as 2027, customers would be able to conduct “public money” transactions in both digital and physical forms.
Christine Lagarde, head of the European Central Bank, recently presented an update in which she discussed the latest developments in the union’s CBDC activities.
On September 25, Lagarde staunchly defended the ECB’s CBDC proposal, stating that the money “will not be completely anonymous as is the case with a banknote.”
Since digital money leaves a trail on the blockchain, it will not be fully anonymous like a banknote, but we are trying to ensure that your privacy is protected.
After certain members of the European Parliament (MEPs) raised questions about the CBDC initiative, including its potential effects on users’ right to privacy, Lagarde spoke out.
Lagarde said that the ECB will not track the whereabouts of digital currency transactions. Lagarde acknowledged that commercial banks would have access to information since the system would use them “as intermediaries to disseminate the digital euro.” She also said that the banks will conduct analyses and make the results available to CBDC customers.
Banknotes defeat the purpose of trying to stop money from being laundered or used to fund terrorism since they may be used anonymously. There will be no “ECB Big Brother” checking up on CBDC users’ transactions, and the ECB will not have access to user data.
Also Read: According To R. Kiyosaki, Bitcoin Will Be Worthless Once CBDC Hits The Market
Wallets