•The digital euro will be free to use and accessible to all.
•Lawmakers will decide what personal information the bank will have access to.
•The ECB hopes to complete the preliminary phase of the digital euro project by 2023.
The European Central Bank (ECB) has announced that the Digital Euro will be free to use and accessible to all, but it will be up to legislators to decide what personal information the bank will have access to.
The Executive Board Member of the ECB, Fabio Panetta, stated that it will be up to the co-legislators to establish the optimal balance between the protection of privacy and the achievement of other important objectives of a public nature. These objectives include the fight against money laundering, the financing of terrorism, and tax evasion or compliance with any sanctions.
The ECB has been studying the digital euro since October 2021 and hopes to complete the preliminary phase of the project by 2023. The European Commission will submit its legislative proposal regarding the digital euro to the European Parliament and the Council of the European Union for their consideration.
In order to provide the public with access to the digital euro, the ECB has proposed two different models. The first model involves a direct-to-central bank approach, while the second model involves a supervised intermediary approach. The supervised intermediary approach is preferred by researchers as it allows intermediaries to better identify use cases for conditional payments and other advanced payment services.
The ECB could either develop its own standalone payment app or allow private banks to incorporate the digital euro into their systems as intermediaries. This would ensure that the public has access to the digital euro, regardless of their financial situation.
The ECB is committed to providing the public with a secure, efficient and accessible digital euro, while also protecting the privacy of its users. It is now up to the co-legislators to establish the optimal balance between the protection of privacy and the achievement of other important objectives of a public nature.