Categories: Blockchain Investments
Topics: Cryptocurrency

Unveiling the Digital Euro

The European Central Bank (ECB) is actively developing the digital euro, a virtual currency intended to function as an online wallet or bank account. This initiative is designed to be free for use and is backed by the ECB to ensure confidence.

The International Monetary Fund has suggested that digital currencies will have a limited impact on monetary policy outside of crises. The distribution of the digital euro will involve the ECB, commercial banks, and digital wallet providers with accessibility limited to euro area residents and citizens abroad.

The EU Council and Parliament recently reached a provisional agreement on the eIDAS2.0 framework for a European digital identity, introducing digital wallets linked to national digital identities.

However, over 500 cybersecurity and privacy experts raised concerns in a letter, fearing potential Big Brother surveillance. The letter argues that the legislation could empower any EU government to monitor citizens' web browsing, prompting the need for special web browsers. 

Notable signatories include the Electronic Frontier Foundation and industry members like Akamai and Cisco.

This new eID ticks most if not all of the boxes raised by conspiracy theorists over the last few years, notably:

• Digital identity card issued by the government that will be required to buy and sell.
• Digital wallets required to transact leading to the eventual discontinuation of cash.
• Implementation of a central bank digital currency (CBDC) issued to said digital wallets.
• CBDCs will be programmable and all transactions monitored and approved or denied by a central authority, i.e. total surveillance and control over personal finance and commerce.

Despite the EU Council and Parliament agreement, the legislation is not final, allowing room to address the raised issues. Privacy is and should remain a fundamental right, therefore, we should all be on guard against the potential for the EU certificate requirement to enable widespread web transaction surveillance.

This development aligns with the global trend of central banks exploring their own digital currencies, a movement spurred by the rise of stablecoins (cryptos pegged 1:1 to existing currencies). The ECB project is a response to the increasing prevalence of electronic payments in the EU, which surged from 184.2 trillion euros in 2017 to 240 trillion euros in 2021, driven in part by the COVID-19 pandemic.

Joana Cotar, a member of the German federal parliament and a proponent of Bitcoin, challenges the proposed digital euro by expressing concerns about potential excessive control granted to central banks, which could result in the aforementioned surveillance and privacy issues. 

Cotar draws parallels with the Chinese social credit system and emphasizes the importance of safeguarding privacy and resisting state-controlled payment systems. Despite assurances from European Central Bank officials regarding user data privacy, Cotar remains skeptical and raises awareness about the potential dangers associated with the digital euro.

In contrast to her reservations about the digital euro, Cotar advocates for Bitcoin through her initiative, "Bitcoin in the Bundestag." She aims to educate German lawmakers about the benefits and risks of Bitcoin, envisioning its use for tax payments, stabilizing power grids through mining farms, and establishing a legal framework recognizing Bitcoin as legal tender in Germany.

While addressing concerns such as money laundering, Cotar promotes a balanced approach that encourages innovation and preserves the freedom aspects of Bitcoin. Her ideas could serve as a model for other countries, underscoring the importance of international cooperation in developing standardized regulations for Bitcoin.

I’ve identified three cryptos you need to buy now in order to protect yourself and profit from these changes to the banking system. Find out about them here.

Keep coming back,

Chris Curl
Editor, Daily Profit Cycle