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ECB's Digital Euro Plan Faces Pushback Over Privacy Fears

Key Takeaways

  • ​The ECB is promoting a digital euro to ensure access to electronic payments, especially during outages or emergencies;
  • Lawmakers are worried the digital euro could lead to privacy issues and hurt traditional banks if people shift to ECB-backed wallets;
  • The ECB claims it will not track user data and says an offline version of the digital euro would protect privacy like physical cash.

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ECB's Digital Euro Plan Faces Pushback Over Privacy Fears

The European Central Bank (ECB) has once again promoted its plan for a digital euro, but not everyone is on board.

Lawmakers in the EU have raised several concerns, especially around how such a project might affect privacy and traditional banks.

During a September 4 hearing with the European Parliament’s economic committee, ECB board member Piero Cipollone said the digital euro would allow people across the EU to make electronic payments at any time, including during emergencies.

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However, some members of parliament questioned whether people’s personal information would be protected and whether individuals would start moving money out of commercial banks and into central bank-backed digital wallets.

Cipollone explained that the ECB would not have access to data about who sends or receives money using the digital euro. He also said there would be an offline version of the currency that works like cash in terms of privacy.

According to him, the goal is not to replace banknotes but to support them, especially since digital payments are becoming more common in everyday life.

Cipollone also pointed out that many of the systems Europe uses for digital payments are built by companies based outside the EU. A digital euro, he argued, would provide a backup if networks go down or cyberattacks occur.

He mentioned that the US is already exploring stablecoins backed by the dollar.

Recently, the ECB confirmed that traditional banknotes and coins will remain part of Europe’s payment system. What did Cipollone say? Read the full story.

Aaron S. Editor-In-Chief
Having completed a Master’s degree in Economics, Politics, and Cultures of the East Asia region, Aaron has written scientific papers analyzing the differences between Western and Collective forms of capitalism in the post-World War II era.
With close to a decade of experience in the FinTech industry, Aaron understands all of the biggest issues and struggles that crypto enthusiasts face. He’s a passionate analyst who is concerned with data-driven and fact-based content, as well as that which speaks to both Web3 natives and industry newcomers.
Aaron is the go-to person for everything and anything related to digital currencies. With a huge passion for blockchain & Web3 education, Aaron strives to transform the space as we know it, and make it more approachable to complete beginners.
Aaron has been quoted by multiple established outlets, and is a published author himself. Even during his free time, he enjoys researching the market trends, and looking for the next supernova.

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