I would like to see how the Digital Euro works in regards to privacy laws. If all transactions are traceable I would see this as potentially a dangerous move for EU citizens, whilst at the moment we may trust our governments to a degree we also see a substantial move towards Fascism all over the continent.
this post was submitted on 03 Jul 2023
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I think it is supposed to be untracable in the same way cash is. It's even supposed to be usable offline.
Whether or not they will accomplish this is yet to be seen.
being a pessimist here for a second:
once this reaches a more mature stage, there will be somebody claiming it would be used when selling drugs or other illegal activities and those privacy concerns will go out the window :/
I think that's not that pessimistic.
I don't expect there to be good privacy straight from the start, no matter what they say right now.
That would be nice and eliminate my main fear in regards to this. Do you have any info on how that is supposed to work?
Nothing is decided yet, according to their website:
The Eurosystem is experimenting with different approaches and technologies to making a digital euro available. This includes both centralised and decentralised solutions such as DLT. No decision has been taken yet, however.
They just have announced their plans, but its still many years away
Then why do they want it?
There is a whole website to explain that. Specifically, there is a PDF under the "Why might we need a digital euro?" section, but also this interview says similar things.
I think it is supposed to be untracable in the same way cash is.
If you want something like that, take a look at GNU Taler. https://www.taler.net
Itβs even supposed to be usable offline.
That doesn't make it more privately friendly. After all, you need a way to attest that the payment has actually happened, and that the money was valid, which is much harder (or impossible) to do in a privacy-guaranteeing way without a central authority (like servers from the ECB).
Even if all states in the EU are friendly and don't use our data for evil things, or block us from paying due to invalid reasons, a payment system without privacy by design is still not ok. By implementing such a payment system, the EU supports similar systems being used in suppressive governments, as those can then use the EU doing the same as justification. And, of course, there's no guarantee that the whole EU would stay 100% friendly.
I think it is supposed to be untracable in the same way cash is.
If you want something like that, take a look at GNU Taler. https://www.taler.net
Itβs even supposed to be usable offline.
That doesn't make it more privately friendly. After all, you need a way to attest that the payment has actually happened, and that the money was valid, which is much harder (or impossible) to do in a privacy-guaranteeing way without a central authority (like servers from the ECB).
Even if all states in the EU are friendly and don't use our data for evil things, or block us from paying due to invalid reasons, a payment system without privacy by design is still not ok. By implementing such a payment system, the EU supports similar systems being used in suppressive governments, as those can then use the EU doing the same as justification. And, of course, there's no guarantee that the whole EU would stay 100% friendly.
Yes please! I'd love the ability for electronic money transfers (even offline!) without being dependent on private service partners like fucking Google, Apple and Mastercard.
Maybe explain it more as a payment standard, a protocol, not so much as another currency.
Right? Currently, the most accepted payment Systems are under the control of us companies. Having a European alternative (even a shitty one) would not be the worst thing.
They keep speaking about advantages but list none nor can i see any.
I can already use my ec card to pay and i need a bank account for my bills anyways so why would i get another digital option
If you mean German EC cards, afaik they mostly don't work outside Germany.
And most Credit and Debit cards today are operated by either Visa or Mastercard, two American companies.
I think one of the main purposes of the digital Euro is to counter that monopoly.
I've used the EC card in Austria, as well as Sweden and Italy without any issues.
When? Because until last month they still had Maestro on them. It's likely that you used that in those other countries unknowingly. EC is a distinctly German thing.
My Sparkassenkarte worked perfectly fine in the Netherlands just 3 weeks ago.
I didn't even know they killed Maestro and assumed it used that.
They killed it at the end of June, so I assume it did still use Maestro.
right my bad, yes ofc with maestro on it i thoguht ec was a general word for electronic payment with a debit card
It's important to note that Maestro was just killed off by Mastercard. So now you'll need a Visa or Mastercard Debit Card. Which is probably one of the reasons why the EU would like a system that isn't dependant on these two US companies.
I mean for one you're not actually transferring Euros when you use your EC card, or use your bank account in general: You're using Bank Euros, which the bank promises it can back with ECB Euros but if you look at its balance sheets then it will have too few ECB Euros to back everything because that's what fractional reserve banking means: If you put 100 ECB Euro on your bank account your bank has to deposit one ECB Euro with the ECB, it can do whatever (within the law) with the rest. Like depositing a further 50 ECB Euros with the ECB and adding 5000 Bank Euros to your account and calling it a credit.
Coins and notes are actual ECB Euros, the real deal, no ordinary banks involved. The digital Euro allows that kind of immediacy also in, well, the digital space.
It may just stand on its own, or it might be an ingredient in full reserve banking down the line. In particular it would allow the ECB to increase and decrease monetary supply very freely without having to rely on the whims of other banks, that was especially an issue in the financial crisis where no matter how cheap the ECB was lending out money to the banks, they wouldn't use it to give loans to customers. The ECB can't really fulfill its mandate of price stability if it doesn't have proper control of the supply of the kind of money that people are actually using, which increasingly is electronic and thus non-ECB Euros.
I play with crypto (don't kill me) and it's insane to see how I can send/receive funds between family members in a non-EU country with ~0 fees via a public, open source network AND the funds are there within seconds/minutes depending on network traffic.
Imagine travelling to countries without the euro and MasterCard or Visa doesn't take 3% on the official exchange rate for each of your purchases.
Sure there are new challenges and risks, but the benefits are there too.
EC is Maestro and it has been discontinued. Once your card gets renewed, you basically move to a Mastercard, since they own Maestro/EC More: https://www.mastercard.com/news/europe/en/perspectives/en/2021/blog-from-valerie-nowak-why-this-maestro-is-retiring-after-30-years/
Y'all talking about digital Euro while here I am dreaming Czechia accepts Euro in general. FML.
How is this different from normal the normal Euro. I seem to be able to use these digitally just fine. That is without even living in a euro zone country. Various digital payment services just makes thing work. also I know that actual printed cash is a vanishingly small amount of euros in circulation anyway.
The difference is that european citizens shouldn't be required to deal with profit driven companies (banks) to have access to legal currency.
Technology wise, think of it as some sort of crypto euro. The point is to have the un traceability, privacy and security advantages of crypto, but with a currency that can't be speculated upon that is an actual real currency.
If the central European bank sold 1 digital euro for 1 euro, and bought 1 digital euro for 1 euro, always, the currency would always have a real value attached.
Anyway, I have not read anything on the currency, but color me surprised if they do something that I'd not similar to what I mentioned.
I didn't know a digital Euro was on the drawing board! I am very intriguing but his article is very short and doesn't say very much. Thanks for sharing anyway!
There's not much info because everything is still quite vague. But you can check this article from Euronews as well.
Thanks, this article gives more information about the basic concept. From what I understand it's a digital wallet hosted in your phone (or another device, could be a card as well maybe?), the wallet must be loaded manually and replenish the same way, and from there the payment can take place completely offline. Sounds similar to concept already in use at small scale (e.g: during university we had our students card used like a small wallet that can be use to pay for meals, snacks and parking through out the city).
Yes in some documents and slides they also talk about a card option.
Why we need it? Lagarde said it sounds cool and also others are doing it. We want to be cool for once. /s
The ECB actually seems to be at the front of central bank digital currency development. Other have just vaguely announced their interest, the ECB has actual ongoing research and prototype development with public conferences, documents and updates.
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Cash only.
feels like a resistance act these days..
The idea of a digital Euro is, to be a digital cash equivalent. No central insurance involved that could track the payment, should work offline, ... Just without the hassle of having to deal with physical coins and bills.
Bank lobbyists are going to kill this so hard. They could lose all control they currently have over peopleβs money.
Will it be possible to pay for a service in Poland online while residing Portugal and not have to use paypal, visa, mastercard, or some other USAian service?
Of course it's only complementary - now, that people still need convincing. Once it's installed they'll push to remove cash for good as ultimately it's about control. And not being able to track cash transactions has been driving our governments crazy since forever.
No, thanks!
This will crowd out extremely vulnerable people, like people who are jobless. Every cent spent can be seen, criticized, marked off etc etc. Cash cannot be tracked, and yes, that invites crime, but I do not want all my transactions to be visible at all times. My friend who gets unemployment already cannot participate normally or borrow money from me because he has to show his PayPal and declare everything as income.
Cash is freedom.
The aim of the research on a digital euro is to have characteristics similar to cash. I suggest reading this op-ed and this interview.
Itβs pretty easy to pretend that crimes are necessarily bad but we all know that that isnβt true. Keeping a method around to fund illegal activities is highly necessary for continued social progress. Imagine if every donation to the black panthers had been traced.
There's a thing I still have doubts.
Will I be able to open an account of digital euro directly in the EC for free?
I doubt it as it would mean ruin for banks.
I suppose banks could still lock you down to their accounts when asking for a mortgage but still, they would loose million of accounts.
I really hope that could be the case, but I suppose banks are lobbying hard so that would not materialize in that way.
There's going to be a limit (3000β¬?) for how much you can store on the digieuro account
At the moment, the plan is for the digital euro to be issued/"minted" by the ECB and also all transactions will be resolved by the ECB, however the ECB won't offer any sort of digital euro account or banking service, the banks will do that instead. The ECB is planning for the digital euro to be free to use for paying for private customers, free to use for donations or exchanges of money between people and free to use for online payments as well. They also want provisions specifically for poor and underbanked people.
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