I have read about the digital euro talks
here and I think it is worth sharing with the forum what is the current thinking or the European Institutions:
Citizen´s consultation yield concerns about:
- Privacy - 43% of people are worried about this!!- Usefulness and safety
- Integration in the current systems
- Efficient and cost-less
While the ECB acknowledges the need for privacy, they also say:
Digital euro payments could guarantee different degrees of privacy[7], involving different trade-offs with other policy and regulatory objectives such as the need to combat illicit activities
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In theory, digital euro payments could be anonymous if users’ identities were not verified when they access digital euro services. But this anonymity would provide fertile ground for unlawful activities and could prevent compliance with regulations on anti-money laundering and combating the financing of terrorism.
So, yes, privacy is going to be a concern, yes the institutions will not make digital euro anonymous per-se so I my view we should expect it to be very unlike cash and yes it does open the door to making cash restricted for very small payments and thus having a massive control over people.
My self-question is, up to what point a successful launch of a digital Euro, versus a Digital Yuan and a Digital USD may increase the attractive of these currencies and thus could impact the exchange rate beyond the usual interest rates / inflation / import-export components of the demand for currencies.
Personally, I think the reservation of funds should be made equally 1:1 for unpredictable problems with network and hacker attacks, but the difficulty of creating such system is really complicated including that it should be made for whole European union. Indeed it's so possible in current realities and in other hand really difficult to make it work ideally and securly working for whole union, will be great if they will make it decetralized as DEX exchanges, without a central control but it's impossible