Digital Euro Could Be Linked to Conditionalities and Will Not Be Anonymous, ECB’s Lagarde Says
21 March 2023
By Xavier D’Arcy – BASEL, Switzerland (Econostream) – A future digital euro could be associated with conditionalities but not programmable, European Central Bank President Christine Lagarde said on Tuesday.
Speaking at the Bank for International Settlements’ Innovation Summit, she said that no future digital currency would be as anonymous and as able to protect privacy as cash.
‘If we all to say that […] a euro is a euro whether it is digital or cash, it cannot be programmable’, she said. ‘It can be associated with conditionalities, which is different, but not programmable.’
Regarding privacy concerns, she said ‘is it going to be as private as cash? No. So a digital currency will never be as anonymous and as protecting of privacy in many respects.’
In October, the ECB ‘would move into the beginning of the implementation, which is not a definite green light, but certainly one that would move us closer to operating completely with a digital euro’, she said.
A key argument for the digital euro was maintaining the ‘integrity’ of central bank money, she said. It was essential to ‘make sure that we have an alternative to cash and to make sure that there is actually an anchor to our monetary policy and to the sovereignty of our monetary action, which if cash dwindles away, is then anchored into a digital payment.’
‘Resilience’ was also a key driver of the project, she said: ‘it's to make sure that we can safeguard European payment autonomy.’
‘We just have to be careful, as we have experienced recently with other instruments that are of critical use such as energy, it's very unhealthy to rely on one single source of energy, it's very unhealthy to rely on one single source of payment’, she said.