Eurozone finance ministers promise support for the digital euro project, Talk Privacy – Finance

Finance ministers of eurozone countries reiterated their support for preparations for the possible introduction of a digital euro. Meanwhile, the single currency area's monetary authority sought to reassure future users that the new currency "will preserve privacy by default and by design."

The Eurogroup remains involved in the development of the digital euro, saying many decisions are political

Finance ministers of the EU member states that have introduced the common European currency Eurogroup met on Monday in Brussels on the occasion of Croatia's entry into the Eurozone and discussed current topics - from the economic situation to financial policy coordination in the Eurozone.

One of the topics discussed was the further development of the initiative to issue a digital version of the euro. In a statement adopted by the forum, government officials pledged to continue their involvement, with Paschal Donohoe, the president of the informal format, being quoted as saying:

We plan to continue our political engagement with the ECB and the Commission as they move forward in their processes, as the Eurogroup today recognized that many upcoming decisions are inherently political.

“The Eurogroup believes that the introduction of a digital euro and its main features and design options require political decisions that should be discussed and taken at political level,” says the joint statement, highlighting the need for this legislation approved by the European Parliament and the EU Council.

While reaffirming their commitment to support the project that is still in its Investigation phase which began in mid-2021, the ministers also emphasized that a future decision on the possible issue “would only be made after further explorations in a possible implementation phase”.

After their discussions, group members insisted, among other recommendations, that a digital euro should complement, not replace, cash. Central bank digital currency (CBDC) should provide a high level of privacy, they also said, explaining:

To be successful, the digital euro should ensure and maintain user trust, for which privacy is a key dimension and a fundamental right.

ECB claims Europe's digital currency will ensure privacy of payments

“Preserving privacy by default and by design” was one of the stated goals in a “Digital Euro inventory” Test report also published this week by the European Central Bank (ECB). In outlining its views on the matter, the regulator said the digital euro would “ensure the protection of personal data and payments,” detailing:

The ECB will have no information about people's holdings, their transaction history or payment patterns. The data is only accessible to intermediaries for legal compliance purposes.

The Eurozone monetary authority further emphasized that its CBDC will not be programmable money, while noting that lawmakers will have the final say on the balance between privacy and other policy goals. The ECB also hinted that more privacy could be allowed for less risky and offline transactions.

Do you think Europe will eventually decide to issue a digital euro? Share your expectations in the comments section below.

Lubomir Tassew

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens' quote: "Being a writer is what I am, not what I do." In addition to crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.

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