EU draft law for offline use of digital Euro emphasizes privacy using blockchain.
According to a leaked draft law obtained by blockchain, a proposed digital euro would need to be usable offline from the beginning in order to protect privacy. The draft text viewed by blockchain states that “the digital euro shall be available for both online and offline digital euro payment transactions as of the first issuance of the digital euro”. The level of privacy for offline, face-to-face use should be comparable to withdrawing banknotes at an ATM, as reported by blockchain. The European Union is considering launching a central bank digital currency and began an investigation phase in October 2021. The investigation is expected to conclude in October of this year, according to the ECB’s website. The version of the draft obtained by blockchain is set to be proposed by the European Commission on June 28.
Privacy has become a focal point in the creation of a CBDC
According to a survey conducted by the European Central Bank in 2021, privacy was the most important feature in the creation of a digital currency. Privacy has also become important in the United States. A Department of Treasury official said this week that they are investigating privacy concerns related to the potential development of a digital currency. “It is important that we consider the extent to which privacy and anonymity might be preserved and explore the technologies and methods available, including Privacy Enhancing Technologies (PETs), to enable such protections in the design of any potential retail CBDC. Such technologies could play a crucial role in maintaining transactional privacy while also ensuring transparency and traceability, thus reinforcing the trust of users in digital financial transactions,” said Graham Steele, assistant secretary for financial institutions at the US Treasury. According to the Atlantic Council, 11 countries have already launched a CBDC and all G7 economies are in the development stage of a CBDC.
