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Europeans raise privacy concerns over digital currency

Future European digital currencies need to be unable to track user payments, according to respondents to a survey by the European Central Bank that emphasized the importance of privacy in future financial innovation.

Over 40% of over 8,200 respondents Consultation For the digital euro, he said it was their priority that payments remained a “private issue”, reflecting the deep attachment of many Europeans to cash anonymity.

This answer called for the ECB to give the digital euro, which the ECB defines as central bank money digitally available to all parties, a cash-like feature that can be used offline without internet access. It was.

Consultations with the ECB’s citizens and expert groups are part of the effort to build support for efforts to keep up with the rapidly changing world of digital currencies and payments. By the middle of this year, it will announce whether it will prepare to launch its own digital currency. ECB Board Member Fabio Panetta, Told to MEP On Wednesday, the currency may be ready to launch in about five years.
“As electronic payments become more and more popular, the digital euro ensures that sovereign money, a public good that central banks have provided to citizens for centuries, is still available in the digital age. “He said. “The digital euro does not mean the end of cash. It will complement cash, not replace it.”

In much of Europe, cash is still used for the majority of payments in stores and cafes, and ECB talks have shown that the digital euro will allow businesses to benefit from people’s payment data and governments to spy on finance. Suspicion has emerged that it may open the door to the euro. activity.

The central bank said that “most citizens” in consultation prefer digital currencies restricted to offline transactions, even if the amount of innovative services they can offer is limited.

“Privacy-focused offline digital euros, online euros with innovative features and additional services, and the specific choice of a combination of the two, citizen respondents generally focused on privacy. We choose an offline solution, but professional respondents find the hybrid approach more attractive. “

Most respondents prioritized privacy, but Panetta said, “I understand the trade-offs that the introduction of the digital euro will inevitably impose.” In particular, we need to respect laws that prevent illegal activities such as money laundering and terrorist financing.

He needs to impose limits on the amount each person can hold “to protect financial stability and banking intermediaries by preventing excessive capital flows and excessive use of the digital euro as a form of investment.” Therefore, he said that the digital euro cannot be made completely anonymous. ..

ECB has been test A “bareline sturment” for storing small amounts of digital euros on hardware devices for use in offline transactions without the need for an internet connection or third party involvement.

In another experiment, central banks used digital euros via a “distributed ledger,” a blockchain technology behind cryptocurrencies such as Bitcoin, to test a tool that separates an individual’s identity from payments. did.

Panetta said: “Preliminary experiments on the digital euro show promising results on how to use technology to protect user privacy without relaxing standards for illegal activity.” Europeans raise privacy concerns over digital currency Source link Europeans raise privacy concerns over digital currency. – californianewstimes.com