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- We’ve seen in other jurisdictions where a sovereign consolidating that type of power may not be for a benign purpose, said Niforos, a crypto tech specialist who previously worked on the design of the digital euro with the EU Blockchain Observatory.
- At a meeting next week, the currency zone’s finance ministers will also express their opinions, and they are unlikely to want new forms of financial secrecy to undermine anti-money laundering and anti-tax evasion rules.
- In a consultation conducted by the European Central Bank last year, ensuring that a digital euro protects privacy emerged as the top priority. It’s understandable, given that data on spending habits could expose personal information such as a person’s lifestyle, tastes, and political beliefs.
Privacy appears to be slipping down the priority list for those working on a new digital euro, with experts warning that the design choices made could make privacy more difficult to achieve. There have been no explicit policy decisions on whether the euro might be issued in a new, digital format, but the idea is definitely gaining traction. Euro finance ministers will meet on Monday to address the matter, and the European Commission is expected to launch a survey soon, paving the way for new legislation.
Concerns Regarding Security
In a consultation conducted by the European Central Bank last year, ensuring that a digital euro protects privacy emerged as the top priority. It’s understandable, given that data on spending habits could expose personal information such as a person’s lifestyle, tastes, and political beliefs.
However, privacy issues no longer appear to be a sacred cow. Recent ECB research, based on interactions with panels of EU residents, stresses other, competing concerns individuals may have, such as security and general acceptance, and ECB board member Fabio Panetta now speaks of a trade-off between those goals. At a meeting next week, the currency zone’s finance ministers will also express their opinions, and they are unlikely to want new forms of financial secrecy to undermine anti-money laundering and anti-tax evasion rules.
According to the internal policy paper that would form the foundation of their discussion and was viewed by CoinDesk, fully anonymous digital money would pose severe issues. Despite business protests about compromising privacy, national governments – and, as of Thursday, the European Parliament – have been eager to introduce client identity checks for even minor bitcoin payments in traditional cryptocurrency exchanges.
The ECB would have access to transaction data to the level necessary to carry out its tasks, such as settling payments and performing financial monitoring, according to the strategy paper, but the trove of payment data would not be completely visible to any central organization. Panetta dismissed concerns about government spying, telling the European Parliament’s Economic and Monetary Affairs Committee on Wednesday that the ECB has no commercial interest in using this data and will respect privacy laws until the last comma – unlike profit-driven businesses, he suggested.
Management From The Single Location
He also argued that the specifics of how much privacy to provide – such as whether to provide carve-outs that allow small payments to remain secret and offline – should be decided by governments and lawmakers rather than central bankers, claiming that privacy… is not a technical issue; this is a political issue. Experts, on the other hand, have questioned his assessment and warned that too centralized systems could make true privacy much more difficult to accomplish.
Marina Niforos, an affiliate professor at HEC Paris, told CoinDesk that she disagrees with Panetta’s assertion that privacy issues are solely tied to profit-driven, commercial usage of data, and that people are correct to be concerned about governments acquiring such power over data. We’ve seen in other jurisdictions where a sovereign consolidating that type of power may not be for a benign purpose, said Niforos, a crypto tech specialist who previously worked on the design of the digital euro with the EU Blockchain Observatory.
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Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
