Recently, a body comprising all the Finance Ministers of the Eurozone countries, the Eurogroup, has taken stock of digital euro progress. After its meeting, they said that the digital euro could not be programmable money. In other words, there would be no restrictions on the type of goods and services to be purchased or on time for using the digital euro.
EU commission is responsible for proposing a digital euro bill
Last Monday, Eurogroup released a statement saying that the digital euro could not be programmable money, which means there would be no restrictions on the types of goods and services you purchase using it. This was just one of the several views they stated after its meeting to take stock of the progress of the digital euro, the bloc’s CBDC. This project began in 2021 and is expected to be in the investigation phase for 24 months.
The EU is among those 100 jurisdictions worldwide researching or developing a CBDC, while the US remains cautious on the merits of a CBDC. The EU Commission is also responsible for proposing a digital euro bill later this year. EU leaders also must decide whether to use a digital euro after Oct 2023.
In its discussion, the Eurogroup noticed that the digital euro should complement and not replace cash, be given a legal tender status and ensure a high level of privacy. The group also mentioned that the CBDC should be widely accessible to the public, guarantee access to the central bank money for euro area users, and its design should also consider the environmental implications.
Digital Euro design will help prevent money laundering and illicit funding.
Recently, Eurogroup took stock of the digital euro progress and said it could not be programmable money. They also stressed the need for the digital euro’s design to prevent money laundering, illicit funding and tax evasion while maintaining the user’s trust. Critically, the finance ministers of the Eurogroup stated that the design of the digital euro should not impair the ability of the European central banks to fulfil their price stability mandate.
They have also supported the offline functionality of the digital euro for use by citizens in multiple scenarios and stated that supervised intermediaries could play an important role. This comes at the back of the Eurogroup lawmakers criticising the world’s biggest e-commerce platform, Amazon’s involvement in the digital euro project to develop a prototype for the e-commerce application of the new CBDC.
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