Publishing its ‘Targeted consultation on a digital euro’ on the 5th of April, the European Commission outlined that it would need to establish laws across privacy and AML should the Union decide to issue a digital euro.
The consultation will run until the 14th of June, and considers whether issues including users needs and expectations for a digital euro, the digital euro’s role for the EU’s retail payments and digital economy, the application of AML-CFT rules, privacy and data protection aspects, and international payments.
The EU has yet to make a decision about whether or not to issue a digital currency at all, and the consultation is a strong precursor to any decision or law drafting rumoured to come out early in 2023.
Throughout 2021 public discussions were dominated by concerns that CBDC would bear a negative impact on privacy across the EU, with the ECB’s Public Survey revealing that it was the number one concern that Europeans want to protect should plans for a digital euro go ahead. More recent research from the ECB indicates that this concern is less of a dominating force in CBDC discussions, as individuals begin accept a certain degree of ‘trade-offs’, along with the genuine concern of fully anonymous digital currencies.
The document reads that this “targeted consultation” is intended to complement the ECB’s public consultation. It aims to: collect further information from industry specialists, payment service providers (including credit institutions, payment and e-money institutions), payment infrastructure providers, developers of payment solutions, merchants, merchant associations, consumer associations, retail payments regulators, and supervisors, anti-money laundering (AML) supervisors, Financial Intelligence Units, and other relevant authorities and experts.
The ECB also addressed privacy concerns in a presentation to finance ministers on the 4th of April, and is currently assessing potential issuance of a digital euro, with the phase expected to continue until September 2023.
CBDCs and cryptocurrencies will be discussed in detail during the ‘Digital currencies and stablecoins - maker or breaker of the financial system?’ panel session at EBAday 2022. After two years as a virtual conference, EBAday 2022 will run in person for its seventeenth year, welcoming a host of board directors, chief executive officers, and payments and technology heads from Europe’s leading banks, as well as selected fintechs.
Register now to attend EBAday 2022 in Vienna, Austria on the 31st of May and 1st of June.