European Union EDPB and EDPS Express Concerns Over Digital Euro “Excessive Centralization” and Data Protection!

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On October 18, two significant European government bodies, the European Data Protection Board (EDPB) and the European Data Protection Supervisor (EDPS), expressed their opinions regarding the need for the EU digital euro to avoid “excessive centralization.” They have raised concerns about data protection, safety, and privacy in developing a digital currency. The European Central Bank (ECB) is now deciding whether to create a digital currency that the government can easily control.

Chair Irene Loizidou Nicolaidou, the European Data Protection Commissioner, emphasized the importance of a high privacy and data protection standard in gaining citizens’ trust in this new digital currency. She also stressed the need to embed data protection in the design phase of the digital euro, whether it is used online or offline.

Mairead McGuinness, the European Commissioner for Financial Stability, expressed gratitude on her Twitter handle for the support from the European Union for the EDPB and EDPS’s desire to establish the digital euro.

The legislation for the digital euro is seen as beneficial for citizens as it allows for digital electronic payments, both online and offline, while still preserving the option to use cash. This approach also aims to provide high data privacy and transparency for citizens.

The EDPB and the EDPS have accepted the proposed regulations related to the digital euro but have also made personal suggestions to ensure the highest standards of personal data protection and privacy in the future of digital currency.

One of their recommendations is the introduction of a ‘privacy threshold’ for online transactions. This threshold would reduce the AML/CFT (Anti-Money Laundering/Countering the Financing of Terrorism) risk associated with low-value digital euro transactions while requiring technical measures to enhance privacy and security.

Overall, the EDPB and the EDPS are actively working to ensure that the development of the digital euro prioritizes data protection, safety, and privacy to gain the trust of European citizens.