Digital euro faces scepticism in Germany over privacy concerns

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In Germany, scepticism towards the digital euro is growing as the European Central Bank (ECB) approaches a decision on its implementation, expected by the end of 2025. report According to Bloomberg, Germans, especially older generations, are still concerned about the security and privacy of the digital euro.

In addition to concerns about tracking and potential misuse of data, Germany’s long-held preference for cash also contributes to its deep resistance to digital financial solutions.

The ECB plans to address these concerns by adopting advanced security measures, such as data encryption, and offering digital currency on cards for offline use.

According to ECB President Christine Lagarde, the ECB's aim is for the digital euro to coexist with physical money, not replace it. The goal is to include everyone, even those who are less comfortable with new technologies.

According to the report, there is a generation gap in terms of comfort level with digital transactions. Younger Germans are more open to the idea of ​​a digital euro. However, Joachim Nagel, president of the Deutsche Bundesbank, believes that Germans can be convinced to use cash.

Nagel also noted that the older population is becoming more tech-savvy and recognizes the need to adapt to new developments.

In addition to Germany, many countries such as Austria and Slovakia also prefer cash to digital payments, while others, such as the Netherlands, have adopted them.

Evelien Witlox, director of the digital euro project, said the ECB is actively considering issuing a digital euro, but “it is not inevitable At the moment, the main motivation for the digital euro is to reduce Europe's dependence on non-European payment services.

If adopted, the digital euro would become legal tender, meaning businesses accepting digital payments would have to accept it, Witlox said.

US lawmakers oppose

According data According to the Atlantic Council, around 134 countries are exploring a central bank digital currency (CBDC). Several countries, including China, Russia and Brazil, have moved to the pilot stage.

The United States is currently in the research and exploration stages of developing a digital dollar. However, Federal Reserve (Fed) Chairman Jerome Powell stated that the central bank had no plans to create one.

“In terms of a CBDC, there’s really nothing new,” Powell said during a Federal Open Markets Committee meeting last month. “There’s nothing much going on at all.”

Like the Germans, Americans are unlikely to be in favor of a central bank-backed virtual currency. Opposition is growing among many political figures and groups due to concerns about government surveillance of citizens' financial activities.

In September of last year, Congressman Tom Emmer introduced the Anti-CBDC Surveillance Act in an attempt to prevent the Federal Reserve from issuing a retail CBDC. The House of Representatives passed it in May and it is now awaiting a vote in the Senate.

In February of this year, a group of five senators, including Ted Cruz, Bill Hagerty, Rick Scott, Ted Budd, and Mike Braun, introduced a companion bill that also seeks to prohibit the Federal Reserve from creating a CBDC directly for individuals, indirectly through intermediaries, or using it to implement monetary policy.

US presidential candidate Donald Trump has publicly opposed the idea of ​​a CBDC. At the Bitcoin 2024 conference in Nashville, he said he would never allow its creation under his administration.

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