ECB starts 24 month digital euro project.

[Lucius]

With other countries seriously considering this direction, the EU has finally start its Digital Euro (CBDC) project. It will take them 2 years to explore the potential of such a currency, and if they decide to actually apply it, they say it would take them at least 5 years to officially launch it. As an EU resident, I am not particularly excited about this, because I know that it will take them much more than 5 years to do anything, and all that time will come in handy for Bitcoin to become more mainstream in EU.

What interests me more is whether the EU will at some point start making some bad moves when it comes to Bitcoin or stablecoins, which they obviously consider competition (although they don't explicitly mention Bitcoin). Of course, this reasoning stems from the assumption that China decided to conduct a final battle with Bitcoin precisely because of its CBDC, which is already being tested on a large sample of people.

Today the Governing Council of the European Central Bank (ECB) decided to proceed with a 24-month central bank digital currency (CBDC) project to investigate the potential of a digital euro. Even if it decides to go ahead with a digital euro, the ECB President has previously stated it would take five years to launch.

While no decision has yet been made whether to issue a digital currency, the ECB and European national central banks have outlined several motivations over the last year or more. The first, as Lagarde stated, is to ensure that as cash usage declines, there is still central bank money but in a digital form. Without a CBDC, there’s a risk that private digital currencies, including stablecoins, will dominate, and they still might. Such a scenario would make it harder for the central bank to control monetary policy, maintain financial stability, ensure low cost payments and enable financial inclusion.

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[Charles-Tim]

As an EU resident, I am not particularly excited about this, because I know that it will take them much more than 5 years to do anything, and all that time will come in handy for Bitcoin to become more mainstream in EU.

Why not excited? Bitcoin is not existing for competition, it is an alternative which also gives privacy. Bitcoin is also an asset, not existing to substitute fiat but as a safe haven and for wealth creation.

What interests me more is whether the EU will at some point start making some bad moves when it comes to Bitcoin or stablecoins, which they obviously consider competition (although they don't explicitly mention Bitcoin).

China is a country controlled only by a single president, Europe is not controlled by a single president. China is a country, Europe are countries and each country is independent. China even ban foreign social media, European countries accept all these social media. China like to act like they are a world on their own, Europes are different, the reason they are part of Western nations. Many countries in Europe are even Bitcoin friendly, China has never been Bitcoin friendly. European countries still gives more freedom to citizens unlike China.

[o_e_l_e_o]

Such a scenario would make it harder for the central bank to control monetary policy, maintain financial stability, ensure low cost payments and enable financial inclusion.

"Financial inclusion"? Please. Bitcoin is the essence of financial inclusion. Don't have good ID? Turned down for a bank account. Don't have a fixed address? Turned down for a bank account. Bad financial history? Turned down for a bank account. None of that matters with bitcoin. Install a wallet, done. No fiat or CBDC will ever be as financially inclusive as bitcoin is. And "control monetary policy" is a nice way of saying "print more money". We've all seen the chart showing USD losing >95% of its value in the last 100 years. Now here's the one for EUR - https://www.statista.com/statistics/1055948/value-euro-since-2000/. A cool 30% lost since its creation ~20 years ago. As the article points out, they are worried that the majority of the population will move to using bitcoin or other cryptocurrencies, which directly impacts on their ability to bail out themselves and their friends and prop up their rigged markets indefinitely.

This has nothing to do with maintaining "financial stability", and everything to protecting their own vested interests.

[amishmanish]

Such a scenario would make it harder for the central bank to control monetary policy, maintain financial stability, ensure low cost payments and enable financial inclusion.

"Financial inclusion"? Please. Bitcoin is the essence of financial inclusion. Don't have good ID? Turned down for a bank account. Don't have a fixed address? Turned down for a bank account. Bad financial history? Turned down for a bank account. None of that matters with bitcoin. Install a wallet, done. No fiat or CBDC will ever be as financially inclusive as bitcoin is.

So true. When it comes to the developed nations, the term "financial inclusion" actually mean the set of entities they want to keep "financially excluded". When someone like Jack Mallers talks of financial inclusion, he is actually talking about giving people with bare minimum resources access to a savings account. The latter is an actual ethical stand while former is just wielding control.

As the article points out, they are worried that the majority of the population will move to using bitcoin or other cryptocurrencies, which directly impacts on their ability to bail out themselves and their friends and prop up their rigged markets indefinitely.

They actually are worried that stablecoins will take over. Right now, most stablecoins are only used for crypto trading. They seem to be pre-empting a scenario where crypto actually begins to be used on a wide scale. With the example of El Salvador, they are truly frightened that they won't have any option to dangle before these poor nation-states as "Oh, look! We've "researched" this CBDC technology for 24 months and are giving it to you free, Use it, not Bitcoin"

I bet if today they had the logistics ready, they'd probably call up every head of state contemplating usage of LN and Bitcoin and give them the offer. The implications for this are huge though. Does anyone believe that these powerful bodies will simply give up all that leverage and power that comes from controlling the financial infrastructure? Honestly, I feel concerned about what their real pushback look like. Currently, its just baby gloves with the FUD and regulations.

[20kevin20]

They'll probably conduct some kind of policy that'll make people get away from Bitcoin. The UK already has a very draconic crypto law and worse is possible to happen at any time. Just make it a pain in the ass to calculate your taxes and to declare your gains/losses and enough will sit on the side rather than joining the game.

As o_e_l_e_o said, they're afraid of us because no matter who was the guy/team who released BTC, since its existence the world finally has one way of going off-grid without an authority checking up on you. No matter who you are and what you've done, you ain't discriminated.

[Sterbens]

I'm not too sure about the idea of launching that EU did and later on it will be far behind. considering the rapid growth of crypto, while the EU still has to wait 5 years to become viable in the market. like you said, they are trying to be competitors without saying it outright. but will it be in vain when cryptocurrency is already 1000 steps ahead of the EU regarding its Digital Euro program?

[o_e_l_e_o]

They actually are worried that stablecoins will take over. Right now, most stablecoins are only used for crypto trading. They seem to be pre-empting a scenario where crypto actually begins to be used on a wide scale.

I don't think stablecoins will ever take over. Bitcoin might, but not stablecoins. Since every stablecoin is based on fiat and claims to be backed up with fiat, then they all inherit all the same problems as fiat has - centralized, inflationary, seizable, not private, not censorship resistant, etc. On top of all that, you add in a further centralized third party (the stablecoin issuer), and all the risks that that brings - insolvency, fractional banking, scams, hacks, etc. Stablecoins really are the worst of both worlds. I'd rather use a CBDC than a stablecoin.

I think they are actually worried about bitcoin. It is bitcoin which has all the features they fear, and which has the widest use, widest adoption, widest user base. And after all, if they really wanted they could just seize all the fiat belonging to a stablecoin issuer and destroy that stablecoin literally overnight.

[Coyster]

With other countries seriously considering this direction, the EU has finally start its Digital Euro (CBDC) project. It will take them 2 years to explore the potential of such a currency, and if they decide to actually apply it, they say it would take them at least 5 years to officially launch it. As an EU resident, I am not particularly excited about this, because I know that it will take them much more than 5 years to do anything, and all that time will come in handy for Bitcoin to become more mainstream in EU.

Whilst that is very much possible, the question, or rather concern is what damaging measures the different governments (countries) that make up the European Union will take within this next five years and definitely more as they work on their CBDC's. There will prolly be tighter regulations as well as policies initiated to discredit Bitcoin as not being safe, reliable...or whatever compared to their CBDC's, obviously before CBDC's come on board, Bitcoin would have gone a very long way, my only concern is actually how many users will be convinced and cajoled into believing some of the lies the government will cook up to try and see if CBDC's will be more used than Bitcoin.

I think they are actually worried about bitcoin. It is bitcoin which has all the features they fear, and which has the widest use, widest adoption,

Isn't that were they are making a mistake, should CBDC's which are centralized be launched in 'reaction' to Bitcoin, I mean, we all know Bitcoin is decentralized, and not just that, there's freedom and control to use your funds just the way you think is right, but the digital dollar, Euro, Yuan, or any centralized digital (shit) coin is actually the opposite of that, should the government not actually be 'trying to stop' Bitcoin with more regulations (I know sooner or later they'll run out of it), rather than creating digital currencies that will work (and be printed) almost in the same way as their fiat currencies

[LoyceMobile]

Haven't they been "exploring" this for like the past 5 years already?

[tyz]

Haven't they been "exploring" this for like the past 5 years already?

Yes, they have been looking at it for quite a while and now seem to have come to a solution, but no idea what to make of it.

The Euro itself is a failed project. Everyone who is not ideologically blinded can see that. It won't get any better if they now introduce an e-Euro on a centralized blockchain and thus shift even more power away from the banks to the central bank. The Euro has failed, with or without blockchain.

[Ozero]

There is no doubt that at the stage of preparing for the release of the digital euro, they will seriously tackle the regulation of the circulation of cryptocurrency and private, commercial stablecoins, as the government of China is doing now. It's just that China has already come to this point, and Europe is at least five years behind them. However, this may happen earlier, already now some EU officials are calling for stricter regulation of the cryptocurrency.

[Wind_FURY]

With other countries seriously considering this direction, the EU has finally start its Digital Euro (CBDC) project. It will take them 2 years to explore the potential of such a currency,

I believe in that 2 years, they’ll discover the truth for themselves. That there’s nothing that they can do to put the genie back in the bottle. The invention of Bitcoin has opened a Pandora’s Box with new possibilities. It definitely WILL BE harder for the central bankers to control the monetary system, but they did that to themselves.

[worle1bm]

Many nations are in similar hoard to develop their CDBC and exploring the concept of blockchain for the same purpose and hiring cryptography experts but it will take long time to build it like you said for more than 5 years at take for EU to launch their digital euro.At that time we can expect that btc already be used on local stores and you just scan a qr code and simply make LN use and payment is done.They are stepping into digitalization but still it will be center oriented and you can still be denied Authorization of your funds through these but on the other side btc will provide you financial support and privacy at the same time and it will your funds.This time it is alternate to fiat but in future the condition will be reversed so wait for that.

[amishmanish]

I think they are actually worried about bitcoin. It is bitcoin which has all the features they fear, and which has the widest use, widest adoption, widest user base. And after all, if they really wanted they could just seize all the fiat belonging to a stablecoin issuer and destroy that stablecoin literally overnight.

I meant the same oeleo but didn't quite came out right. That is why quoted the El Salvador example..LOL. It is interesting that the banks always refrain from naming Bitcoin directly and just use the label "Private Digital currencies". I wonder if a jury was to deliberate on this in any of the presumably great democracies, would they classify Bitcoin as Private? Can Open Source Software be labelled as "Private"?

If not, then what do they have against Bitcoin. They may label everything else which is a foundation/ corporation coin (ETH, ADA etc) as private, but not Bitcoin.

The only thing that needs to be adjudged is that should state have the sole authority to judge what money is or how people exchange value? Going openly against Bitcoin is like going against democracy and freedom to choose. This is why they will continue to be subtle in undermining Bitcoin. Of course not so much in Russia, China or third world countries.

I believe in that 2 years, they’ll discover the truth for themselves. That there’s nothing that they can do to put the genie back in the bottle. The invention of Bitcoin has opened a Pandora’s Box with new possibilities. It definitely WILL BE harder for the central bankers to control the monetary system, but they did that to themselves.

That is the most logical course that things should take. Though it takes one back to the same question. How far will nation-states go in their pursuit to suppress bitcoin and stop it from loosening their grip on power?

[o_e_l_e_o]

should the government not actually be 'trying to stop' Bitcoin with more regulations (I know sooner or later they'll run out of it), rather than creating digital currencies that will work (and be printed) almost in the same way as their fiat currencies

Maybe they've realized they can't. They can regulate centralized exchanges as much as they want, but they can't stop people trading peer to peer. They can force KYC on every online exchange, service, and web wallet, but they can't stop people from mixing their coins and holding them themselves. They can force some mining pools to exclude certain "blacklisted" transactions, but they can't force every mining pool to do that (not least of all the ones in other jurisdictions). They can force payment processors like BitPay to collect KYC and track their customers, but they can't stop merchants from just accepting bitcoin directly. I'm sure they will continue to pass ever more ridiculous regulations, but nothing they do can stop me from holding bitcoin myself and sending it directly to another party in exchange for goods or services.

So perhaps they hope that by launching CBDCs they can simply entice people away from bitcoin altogether, rather than regulate against it.

[Lucius]

Why not excited? Bitcoin is not existing for competition, it is an alternative which also gives privacy. Bitcoin is also an asset, not existing to substitute fiat but as a safe haven and for wealth creation.

Why would I be? Well CBDC is nothing but a digital fiat whose only advantages I see is that there would no longer be a need to produce banknotes and coins, transport and insure physical money. It remains a centralized and even more controlled means of complete control over one's finances.

China is a country controlled only by a single president, Europe is not controlled by a single president. China is a country, Europe are countries and each country is independent.

I put China in this context only because of the link to their CBDC and the fact that its launch coincided with the banning of crypto mining - it is logical to ask whether the EU might be able to introduce some similar measures (though perhaps not so drastic) before introducing the digital euro. China is not a dictatorship in the sense that it is ruled by one man, but by the Communist Party - that one man at its head is only formally the strongest figure.

We can discuss the fact that every country within the EU is independent, but you should know that 70% of all laws are passed in the EU Parliament and are only confirmed at the level of member states - small states have almost no influence - I say this from the experience of my country which accepts everything (even laws that harm national interests) because it has no mechanisms or responsible political leaders who want the best for their people.

Many countries in Europe are even Bitcoin friendly, China has never been Bitcoin friendly. European countries still gives more freedom to citizens unlike China.

That's true, many EU countries have very good laws when it comes to cryptocurrencies, but that doesn't mean there won't be changes - they are on the way and coming for sure, it's just a matter of time.

Europe is Considering Crypto Regulation

This has nothing to do with maintaining "financial stability", and everything to protecting their own vested interests.

Of course, it has nothing to do with what they cite as the main problems, because as you wrote, the EUR is on the same path as the USD, and over time it will lose its value - these pandemic measures will only further accelerate the process. The fear of losing control of the financial system has always been the biggest problem of the governing structures that govern the people through it. A man who is his own bank and absolutely controls his finances is the nightmare of every banker and politician.

[o_e_l_e_o]

Well CBDC is nothing but a digital fiat whose only advantages I see is that there would no longer be a need to produce banknotes and coins, transport and insure physical money.

You would hope, given that the entire currency is both digital and centralized, they could also finally figure out how to make transfers between bank accounts in less than the 3 to 5 days we have to wait at the moment for some wire transfers.

Of course, it has nothing to do with what they cite as the main problems, because as you wrote, the EUR is on the same path as the USD, and over time it will lose its value - these pandemic measures will only further accelerate the process. The fear of losing control of the financial system has always been the biggest problem of the governing structures that govern the people through it.

Perhaps, as an EU citizen, you can provide your opinion on the following: Are the stakes that bit higher in the EU compared to the US? Should there be a complete collapse of our monetary system and USD becomes worthless, then obviously the fallout will be massive, but at the end of it, I would still expect the United States to exist with all 50 states. However, if the Euro collapses, can we say the same about the fate of the EU itself? Would the collapse of the Euro lead to the collapse of the EU?

[bitmover]

Without a CBDC, there’s a risk that private digital currencies, including stablecoins, will dominate, and they still might. Such a scenario would make it harder for the central bank to control monetary policy, maintain financial stability, ensure low cost payments and enable financial inclusion.

This makes absolute no sense at all.
Monetary policy is controlled by the central bank by raising or lowering the basic interest rate of the economy. This has nothing to do with CDBC or Stable coins.

There are also several ways to control stable coins. They are all backed up by real fiat/EUR. Those companies can be easily forced to have a limited supply or just face lots of fines or something like that, for example.

People in cryptospace are overestimating what stable coins can really do. Stable coins are just a private debt, people lend 1 USD to binance and receive BUSD back, because binance promises to pay back 1USD for each BUSD.

I think an EURO CBDC is going to happen not because they are affraid of stable coins, but because it is the evolution of money. It will be a better form of money, which will in long term bring benefits to the economy as it is faster and cheaper to transfer.

Edit: The only cryptocurrency which would really affect central banks to control monetary policy is Bitcoin.

[Wind_FURY]

I believe in that 2 years, they’ll discover the truth for themselves. That there’s nothing that they can do to put the genie back in the bottle. The invention of Bitcoin has opened a Pandora’s Box with new possibilities. It definitely WILL BE harder for the central bankers to control the monetary system, but they did that to themselves.

That is the most logical course that things should take. Though it takes one back to the same question. How far will nation-states go in their pursuit to suppress bitcoin and stop it from loosening their grip on power?

VERY FAR. That’s why it’s to the utmost importance that Bitcoin is given the ability to scale out in order to decentralize further, and over-shoot security. Then what design-decisions should the Core developers make? Smaller blocks, layered protocol.

[Lucius]

Perhaps, as an EU citizen, you can provide your opinion on the following: Are the stakes that bit higher in the EU compared to the US? Should there be a complete collapse of our monetary system and USD becomes worthless, then obviously the fallout will be massive, but at the end of it, I would still expect the United States to exist with all 50 states. However, if the Euro collapses, can we say the same about the fate of the EU itself? Would the collapse of the Euro lead to the collapse of the EU?

This is the question of all questions when we talk about the common currency in the EU (EUR), compared to the US and the US dollar. The stakes, in this case, are incomparably higher than in the US in every sense, because you yourself well conclude that the eventual collapse of the US dollar will probably not affect the collapse of the US as it exists today, but the collapse of the euro would have terrible consequences for the EU.

You probably remember the Greek crisis that started around 2010 (depending on the source), which resulted in the largest attempt to save a country in the eurozone so far, and estimates say that it cost around 320 billion EUR, which puts Greece in the position of a certain debt slavery at least until 2060. Everyone may wonder if it was justified to save Greece or let it sink, but there was no doubt from Germany at the time - I think they would pay much more to save Greece (and thus the eurozone and the euro), just to save the idea of how the EU can actually function in the form in which it now stands. You can read a much better and more detailed explanation that can give you some answers to your question in this article.

While the EU may seem compact from afar, for those of us who live here it is far from it - there are several large states whose influence actually controls all important decisions, and the UK did not like it, as some other members do not like it - especially Hungary, which is trying to pursue some kind of sovereign policy within the EU, so it has been called a rogue member state for some time.

The UK had big problems with leaving the EU despite not being part of the eurozone (luckily for them), but any other country that would try to leave would face a big problem in that case - the exit ticket has a lot of zeros, for many states hard to reach amount. The most important task that EU bureaucrats are currently focused on is not to allow some new Brexit, because regardless of some new countries waiting to become members, another exit of an important member state would be the beginning of the end.

[oHnK]

Their plans to create a CBDC have been around for a long time, even my developing country is already preparing for the realization of the CBDC, I read on the official Instagram of my country's central bank that they are in the research stage and it will take quite a long time.  Implicitly they did create CBDC as a form of their awareness of the development of BTC so that this will be a comparison asset for BTC that already existed before.

[countryfree]

What can the ECB do?

That's the question which needs an answer. So they're launching a "project to investigate the potential of a digital euro", and that's fine, but do they have the right to go further? When the ECB was created, I doubt there was anything in its mandate allowing it to create a digital currency. I guess it would require all eurozone members to agree on the project with the same terms and without conditions. I'm not expecting that anytime soon.

[Coyster]

Their plans to create a CBDC have been around for a long time, even my developing country is already preparing for the realization of the CBDC...

This in indeed another point to highlight and extract the pros and cons, I know there are quite a lot of countries working on the possibility of launching CBDC's sooner rather than later, as a result of the finances required as well logistics and other whatnots, it's mostly developed countries that are actually obsessed with the CBDC, regulation and anti-Bitcoin ideology.

But having said that, I find it somewhat surprising that even developing/underdeveloped countries are actually weighing up the possibilities of launching their own CBDC in reaction to Bitcoin, it doesn't even end there, they are also issuing sanctions and regulations at Bitcoin and dex crypto (just as Nigeria did), I find this to be counterproductive, so many of this country's do not have a functioning economy, plus there is a high rate of unemployment in their land, ordinarily, stopping Bitcoin should be the last thing they should think of when you consider the myriad of economic problems facing them, I find it to just be a clear case of misplaced priority.

[el kaka22]

Like OP said it will take them a lot longer than 5 years, they are not known as a group that can act quickly on anything. Hell UK took 3 elections and few presidents just to get out of EU even while everyone there wanted (okay not everyone but majority enough), so I doubt that it would be 5 years of anything. I assume that minimum 5 years will be spent just to see how it may work, like experiments and testing and so forth, countless resources will be spent (money, man hours, many other smaller things) and eventually it will take another 6-7 years to actually build it and make it work.

I say minimum of 10 years before EU has digital euro as a project ready for the whole world. I know it is a sad situation but that is how they work, they are very very very slow at what they do and the amount of paperwork back and forth causing things to get delayed is a common thing.

[o_e_l_e_o]

I guess it would require all eurozone members to agree on the project with the same terms and without conditions. I'm not expecting that anytime soon.

My understanding was that the ECB could pass down decisions based on "consensus" or "majority" rulings, rather than requiring complete agreement from all its members, but I'm not from Europe so someone can correct me if I'm wrong.

But having said that, I find it somewhat surprising that even developing/underdeveloped countries are actually weighing up the possibilities of launching their own CBDC in reaction to Bitcoin

I doubt developing countries are considering a CBDC in an effort to stop bitcoin. Rather, they are being forced to consider it due to developed countries considering it. There are lots of developing nations which already use USD or some other major currency as a surrogate for their own currency, due to inflation, counterfeiting, easier trade, wider acceptance, etc. Should we end up with a digital dollar, then it would likely become incredibly easy for citizens of these countries to use it for all purposes, rending the country's own currency less valuable and pushing the country towards dollarization, which is something that the government may not want.

[Kittygalore]

I don't know the future of CBDC but I see it being bleak and uneventful because you're basically using fiat money that can track your purchases and when was the last time that you spend your money. This is the anti-crypto and we as the crypto community have to watch out for this because it has a big impact to the community and the market.

[Lucius]

My understanding was that the ECB could pass down decisions based on "consensus" or "majority" rulings, rather than requiring complete agreement from all its members, but I'm not from Europe so someone can correct me if I'm wrong.

The ECB has 3 decision-making bodies, of which the Governing Council is the one that makes decisions. This council consists of the president, his deputy, and 4 other members elected for a term of 8 years, and all the governors of the national central banks. As far as I understand their powers, there must be a common position of all members (governors of national central banks) for a decision to be made - but that is not a problem, governors are appointed to support the ECB's decisions anyway.

What currently comes to my mind are cases where the ECB is the institution that decides whether a member state can sell its gold or not - so France was granted the move, while Italy got the red light (although the request was not even official).


I visited the official website of the ECB and found an interesting podcast entitled "Bicycles, bitcoin and zombie firms: financial stability in the wake of the third wave". I wouldn’t rate it as anything spectacular, but it’s worth listening to.

https://www.ecb.europa.eu/press/tvservices/podcast/html/ecb.pod210616_episode17.en.html

[stompix]

As an EU resident, I am not particularly excited about this, because I know that it will take them much more than 5 years to do anything, and all that time will come in handy for Bitcoin to become more mainstream in EU.

Neither am I, as for the 5 years....cough, Berlin's Airport...cough!  
Let's not even talk about things that require cooperation, Schengen? Military cooperation? Immigrant policy?

As for why we should be happy about it I don't see any reason to, we could be really off with the current system, just improve the banking times, we already have instant banking transfers between 4 nationals banks here and some have started to offer 1-2 hours interval transfer to every country in the EU. About clearing times and whatever happens outside the customer view, I couldn't care less, it's their loss if they are inefficient.

Perhaps, as an EU citizen, you can provide your opinion on the following: Are the stakes that bit higher in the EU compared to the US? Should there be a complete collapse of our monetary system and USD becomes worthless, then obviously the fallout will be massive, but at the end of it, I would still expect the United States to exist with all 50 states. However, if the Euro collapses, can we say the same about the fate of the EU itself? Would the collapse of the Euro lead to the collapse of the EU?

This is the question of all questions when we talk about the common currency in the EU (EUR), compared to the US and the US dollar. The stakes, in this case, are incomparably higher than in the US in every sense, because you yourself well conclude that the eventual collapse of the US dollar will probably not affect the collapse of the US as it exists today, but the collapse of the euro would have terrible consequences for the EU.

As far as the comparison between those two goes I always start with one thing, the US states don't have the long history of having their own currency the EU states have, for most of them it was simply pound, pesos, dollar, the collapse of the US dollar wouldn't put much strain on the union if the Euro becomes toilet paper it will spur addition exits probably. But I don't see the currency crumbling that soon, probably right now it has a more solid position than the US.

My understanding was that the ECB could pass down decisions based on "consensus" or "majority" rulings, rather than requiring complete agreement from all its members, but I'm not from Europe so someone can correct me if I'm wrong.

The ECB has no longer a true consensus policy because it would contradict its own status now where the voting rights for governors are done by rotation so a real consensus can't be reached, they use usually the term majority. Besides, it was never about real consensus and more about negotiating till one would give up.

But, that aside, fiscal rules inside the Eurozone are not simply issued by the ECB, they only control a range of monetary policies, from interest rates to bank loans and buying assets, what would be required in this case would be a consensus of the countries themselves, and in this yes, every country has a veto right when it comes to this. It takes one parliamentary majority in one to refuse it and the project is dead. Not even the EU parliament has power over this decision.

Simply put, the ECB would need new power in order to govern and control the digital euro, they cant grant those themselves and new ones can be given only through a unanimous vote from all the member states just like when the ECB was set up.

[o_e_l_e_o]

the collapse of the US dollar wouldn't put much strain on the union if the Euro becomes toilet paper it will spur addition exits probably.

I'm pretty sure I've still got some French francs tucked away at the bottom of a box somewhere. Never felt right to just throw a currency in the trash. I guess I'll hold on to them in case suddenly they become valuable again.

and in this yes, every country has a veto right when it comes to this. It takes one parliamentary majority in one to refuse it and the project is dead. Not even the EU parliament has power over this decision.

Interesting. It's probably too soon to know, but have any countries expressed any objections to a CBDC so far? And on what basis? Surely when they get fed the usual nonsense of "but think of the children" and/or increased tax revenues through less tax evasion, they'll be quite happy to comply.

[stompix]

Interesting. It's probably too soon to know, but have any countries expressed any objections to a CBDC so far?

I don't know of any country taking a complete political stance against the idea of the digital euro, probably none is really concerned as with a term of two years for testing and another five years in most cases they will not still be in power.  Of course, with the amount of information we have daily is easy to miss things so who knows, there might have been some but the usual naughty kids of the UE have no saying in here, countries like Hungary not being part of the Eurozone so I don't know who would really go opposing and for what reason.
Maybe Cyprus and Malta as this would bring a lot more control over their banks and we all know there are a lot of things going through those acting like gateways in and out of the EU, but, as I said, nothing that I know to date.

Anyhow, 7 years is a lot, we might not even see a CBDC by then, who knows what great idea they will have by then.

[perryxi2]

Is this a currency that wants to be born for them to manage and replace BTC? I don't think the project they came up with doesn't stop there, it sounds like they want to own their own virtual currency.

[paxmao]

Up to what point does this compete with crypto would be a question to examine. Crypto as we understand it is based on the individuality of the holding, being your own bank, having a currency that cannot be used by the will of a political party, etc... The digital CB issued coins do not seem anything like that and carry certain risks of privacy.

I would like to learn the answer to questions like who would be free to open a digital account? Only residents, only companies, everyone in the world? How would KYC be enforced if enforced at all on the owners of CB issues crypto?

I am eager to get the results from the trial and further trials as there are so many implications for people, countries and the world economy.

[Lucius]

I would like to learn the answer to questions like who would be free to open a digital account? Only residents, only companies, everyone in the world? How would KYC be enforced if enforced at all on the owners of CB issues crypto?

In the article I posted in the OP there is a link to a much more detailed explanation of all stages of testing/experimentation, and you can find some of the answers in it. Although it should be borne in mind that a lot can change until the digital euro finally appears in its final form.

https://www.ecb.europa.eu/pub/pdf/other/ecb.digitaleuroscopekeylearnings202107~564d89045e.en.pdf

[amishmanish]

The topic seems to have veered to a discussion about the potential collapse of Euro and the European Union. European Union has been ratified for almost 20 years now and has been around as an idea since the second world war. To an outsider from a developing country, when I read about the aim of peace, prosperity and tackling tough problems together; it sounds pretty noble and humane. The primary aim of the EU was to stop frequent wars within Europe and a kind of political unification.

The process seemed to have given benefits in the 90s but has faced a lot of tests since the financial crisis of 2008. It is interesting that Germany has evolved to play a leadership role while the British have pulled out of it pretty unceremoniously. From an outside perspective, the EU doesn't seem so viable without the UK, but its commendable that the rest of the EU, presumably under German/ French leadership, is soldiering along.

In view of this history, i think EU has larger concerns than deciding what role Bitcoin will play in the future. It maybe the case that they are going for CBDCs more as a logical evolution of banking than fighting against Bitcoin. How they end up viewing Bitcoin is a separate viewpoint evolving in parallel by itself.

[XUNing]

With other countries seriously considering this direction, the EU has finally start its Digital Euro (CBDC) project. It will take them 2 years to explore the potential of such a currency, and if they decide to actually apply it, they say it would take them at least 5 years to officially launch it.

The digital euro will only give more control to the fiat system. The main goal seems to be to eliminate Bitcoin as a potential threat. Their plan is to terminate anonymous cash transactions at the beginning and then attack all decentralized cryptocurrencies so that they can Can control our income and what we buy with their central bank digital currency. This currency must prove its technical feasibility on the same basis as distributed cryptocurrencies. Therefore, it cannot achieve the best balance between utility, efficiency and trust, and it will take several years to release something feasible to the public.

[o_e_l_e_o]

From an outside perspective, the EU doesn't seem so viable without the UK, but its commendable that the rest of the EU, presumably under German/ French leadership, is soldiering along.

I also thought the UK leaving the EU might have been the beginning of the end, but from what I can tell it has made the resolve and commitment of many of the other nations stronger. I think maybe in the rest of the world we still think of the UK as a superpower due to the Commonwealth and the other left overs from the British Empire, when in reality the UK's international standing and influence has been slowly dwindling for years.

In view of this history, i think EU has larger concerns than deciding what role Bitcoin will play in the future. It maybe the case that they are going for CBDCs more as a logical evolution of banking than fighting against Bitcoin.

Technically, a pan-European CBDC should make international payments and international trade completely seamless across all participating countries. Perhaps their desire for a CBDC is actually to strengthen the EU after the UK's departure.

[SquallLeonhart]

Let's wait and see what they are going to do, I am sick and tired of these "projects" that are not even available at anytime, hell not even in development getting news and impacting our world. There are way too many things like these that we talked about and then nothing happened, I am not going to neither worry nor be happy about these because they never made any sense to me at all.

I understand that we are talking about something major here but we have talked about major stuff before and none of that became true. When something in the world of crypto happens it literally just suddenly happens and it is totally out of nowhere, we should not be getting hyped about something that is just in the talks right now and not even in the real world just yet. When it gets started on the development and we see something more then I will believe it, otherwise it is another Libra deal.

[stompix]

I also thought the UK leaving the EU might have been the beginning of the end, but from what I can tell it has made the resolve and commitment of many of the other nations stronger. I think maybe in the rest of the world we still think of the UK as a superpower due to the Commonwealth and the other left overs from the British Empire, when in reality the UK's international standing and influence has been slowly dwindling for years.

The rest of Europe wasn't really seeing the UK as being a part of it, there were a lot of differences, not to mention they kept and had no plan on adopting the Euro as a currency but the whole thing about the UK was a mess. They drive on a different side of the road, they have a different measuring system, you have the United Kingdom and you have Great Britain if you watch the Olympics is GB not UK! Not even mentioning the fact that they are on an island cut away from the continent which adds to the feeling they are not really right here beside us. Plus a lot of people were pissed about their immigration policies, treating people from the EU worse than they treat illegal migrants from their former colonies, bottom line is that a lot of us here in Europe see them as Brits and nothing more.

In view of this history, i think EU has larger concerns than deciding what role Bitcoin will play in the future. It maybe the case that they are going for CBDCs more as a logical evolution of banking than fighting against Bitcoin.

What fight against bitcoin?
If they would want to fight against it we would simply ban it the next day, you give to much importance to a thing that is just a grain of sand compared to the EU multi-trillion trillion economy, CBDCs are meant for something else.

Stop seeing enemies everywhere, is not healthy!

[NeuroticFish]

Technically, a pan-European CBDC should make international payments and international trade completely seamless across all participating countries. Perhaps their desire for a CBDC is actually to strengthen the EU after the UK's departure.

I don't know if it's about strength or is it more about staying in the game. With all the big financial powers going on the direction of CBDCs, EU had to do the same.
It's interesting that they take their time in analyzing fully all the possible implications. It means that they want to do it good (whatever that means from their point of view!) and it also means that while they signaled that they stay in the game, they don't want to be the first, they don't want unnecessary headaches, but if the others do it, they'll do it too.

[fullhdpixel]

Let's wait and see what they are going to do, I am sick and tired of these "projects" that are not even available at anytime, hell not even in development getting news and impacting our world. There are way too many things like these that we talked about and then nothing happened, I am not going to neither worry nor be happy about these because they never made any sense to me at all.

I understand that we are talking about something major here but we have talked about major stuff before and none of that became true. When something in the world of crypto happens it literally just suddenly happens and it is totally out of nowhere, we should not be getting hyped about something that is just in the talks right now and not even in the real world just yet. When it gets started on the development and we see something more then I will believe it, otherwise it is another Libra deal.

It is going to be exactly like that, remember how Visa was trying to build their own blockchain? People turned that into a huge news where everyone got excited about the fact that maybe we will have a blockchain that is protected by Visa and used in trillions of dollars of money movement all around the world, hell over hundred billion dollars just in USA, so it will slowly and gradually turn into something so huge that blockchain will be part of everyone's live very soon. What happened to that news? It was such a huge news that just by itself the price went up, from that news, where is it now?

It is nowhere to be found, it is literally just gone basically and everyone is just forgetting about it if not already forgot. Which is why I honestly believe that this will be exactly like that, everyone will act like they care now, but eventually people will forget it.

[o_e_l_e_o]

The rest of Europe wasn't really seeing the UK as being a part of it...

It's interesting that the general view of the UK differs so much from within Europe as opposed to from outside Europe. Certainly they seem pretty intent on building walls rather than bridges at the moment (metaphorically speaking). As the world becomes more and more interconnected, I'm not sure what they are looking to gain by isolating themselves from it. I've not been paying a huge amount of attention to it recently, but from what news does filter through to me it seems to be driven by some desire to regain the "glory" of the "empire" - Make Britain Great Again nonsense, if you will.

It's funny - the Bank of England used to be one of the most important central banks in the world. It's still important, obviously, but I would say I pay a lot less attention to what it is up to than I did in years gone by. Now the ECB is probably the foreign central bank I read about the most. If and when the BoE launch a CBDC, will anyone outside of the UK even care?

It's interesting that they take their time in analyzing fully all the possible implications. It means that they want to do it good (whatever that means from their point of view!) and it also means that while they signaled that they stay in the game, they don't want to be the first, they don't want unnecessary headaches, but if the others do it, they'll do it too.

Perhaps it's driven by the point stompix made above. If the Fed comes out with a proposal for a CBDC, then they have to take it to Congress and get it to pass a vote. If the ECB comes out with a proposal for a CBDC, then it has to be disseminated to 19 (or is it all 27?) member states, any one of which could veto it. They need to be sure they get it right or it'll never pass.

[zanezane]

I don't know if it's about strength or is it more about staying in the game. With all the big financial powers going on the direction of CBDCs, EU had to do the same.
It's interesting that they take their time in analyzing fully all the possible implications. It means that they want to do it good (whatever that means from their point of view!) and it also means that while they signaled that they stay in the game, they don't want to be the first, they don't want unnecessary headaches, but if the others do it, they'll do it too.

I think it's a bit of both with more favor to staying in the game longer, I think that these people know that their current financial system is already flawed and archaic so they try and make sure that it survives and adapts because they know that it's the thing that keeps them in power.

[Wind_FURY]

Their plans to create a CBDC have been around for a long time, even my developing country is already preparing for the realization of the CBDC, I read on the official Instagram of my country's central bank that they are in the research stage and it will take quite a long time.  Implicitly they did create CBDC as a form of their awareness of the development of BTC so that this will be a comparison asset for BTC that already existed before.

But if the Central Banks believe that a CBDC will stop/discourage people from buying, and using Bitcoin, then they cannot be more WRONG. I believe people HODL, and use Bitcoin because of two things, idealism, and greed. Bitcoin is censorship-resistant, and something that can still surge 10x more. CBDC can’t give you that.

[bittraffic]

Their plans to create a CBDC have been around for a long time, even my developing country is already preparing for the realization of the CBDC, I read on the official Instagram of my country's central bank that they are in the research stage and it will take quite a long time.  Implicitly they did create CBDC as a form of their awareness of the development of BTC so that this will be a comparison asset for BTC that already existed before.

But if the Central Banks believe that a CBDC will stop/discourage people from buying, and using Bitcoin, then they cannot be more WRONG. I believe people HODL, and use Bitcoin because of two things, idealism, and greed. Bitcoin is censorship-resistant, and something that can still surge 10x more. CBDC can’t give you that.

Well EU plans to start blocking anonymous wallet transaction which they could literally make it a hunt for criminals not just for launderer that they usually say.

And then this CBDC although it will take a long time before they could come up perfectly, stablecoins might also be screened or banned because they think that stablecoins are going to be widely used than the CBDC.

[ven7net]

I cannot say that the emergence of the digital Euro is good or bad. The fact is that there is a high probability that the financial world will disintegrate into currency zones in the near future, and then the appearance of the digital Euro, Yuan and other digital currencies of different countries is quite obvious. I believe that more than one state is not interested in making the official currency the currency over which they have no influence and this greatly affects the security of each country. So the emergence of the digital Euro is a common occurrence for me. As for BTC and other cryptocurrencies, some of them will probably work and will continue to simply be not so much money, but assets to preserve and increase profits, such as digital gold.

[NeuroticFish]

If the ECB comes out with a proposal for a CBDC, then it has to be disseminated to 19 (or is it all 27?) member states, any one of which could veto it. They need to be sure they get it right or it'll never pass.

O, clearly. That was part of doing it good. But I have a feeling that's more than that.
But time will tell - whether they do any real step before or after the FED.

[Lucius]

It's interesting that the general view of the UK differs so much from within Europe as opposed to from outside Europe. Certainly they seem pretty intent on building walls rather than bridges at the moment (metaphorically speaking). As the world becomes more and more interconnected, I'm not sure what they are looking to gain by isolating themselves from it. I've not been paying a huge amount of attention to it recently, but from what news does filter through to me it seems to be driven by some desire to regain the "glory" of the "empire" - Make Britain Great Again nonsense, if you will.

It is my opinion that the UK left the EU not only because the citizens wanted it, but also because the US under President Trump advocated a strong sovereignist policy that greatly influenced the end result. In other words, the US was a very strong factor influencing Brexit whether someone wanted to accept it or not - and we all know that the UK has always been closer to the US than the EU because of the very strong historical ties that may have manifested themselves best in the invasion of Iraq or Afghanistan.

If we go back for a moment in 2016 we can see how it all started.

Donald Trump, the presumptive Republican nominee for president, has come out in support of Brexit, saying the UK would be “better off” outside of the European Union and lamenting the consequences of migration in the continent.

And here we can see how it all ended.

Congratulations to Boris Johnson on his great WIN! Britain and the United States will now be free to strike a massive new Trade Deal after BREXIT. This deal has the potential to be far bigger and more lucrative than any deal that could be made with the E.U. Celebrate Boris!
— Donald J. Trump (@realDonaldTrump) December 13, 2019

If we look at things realistically, it is clear to everyone that the ultimate goal of the UK's exit from the EU was to weaken the Union, which in the end happened.

[electronicash]

5 years is too long. they'd be taken over already by the adoption of stablecoins before they could test out to one city in their country. Chinese CBDC may have already spread out in a matter of months even in Africa.

It's interesting that the general view of the UK differs so much from within Europe as opposed to from outside Europe. Certainly they seem pretty intent on building walls rather than bridges at the moment (metaphorically speaking). As the world becomes more and more interconnected, I'm not sure what they are looking to gain by isolating themselves from it. I've not been paying a huge amount of attention to it recently, but from what news does filter through to me it seems to be driven by some desire to regain the "glory" of the "empire" - Make Britain Great Again nonsense, if you will.

It is my opinion that the UK left the EU not only because the citizens wanted it, but also because the US under President Trump advocated a strong sovereignist policy that greatly influenced the end result. In other words, the US was a very strong factor influencing Brexit whether someone wanted to accept it or not - and we all know that the UK has always been closer to the US than the EU because of the very strong historical ties that may have manifested themselves best in the invasion of Iraq or Afghanistan.

If we go back for a moment in 2016 we can see how it all started.

Donald Trump, the presumptive Republican nominee for president, has come out in support of Brexit, saying the UK would be “better off” outside of the European Union and lamenting the consequences of migration in the continent.

what influence Germany this time, because afaik they do have that Dexit plan as well?  i don't think DE are friends with US but when one had successfully cut ties i guess some of them will follow.

[NeuroticFish]

It is my opinion that the UK left the EU not only because the citizens wanted it

Many were tricked into "wanting" that. Clearly US and Russia too wanted a weaker EU and they've got it.
Both EU and UK will have more troubles than benefits from this, although on the long term it may end up as UK back into EU as a proper member (not a special one like before) and maybe with metric system too (for easier transfer of goods). But it will be painful until that is reached and we may have also troubles with (at least) Northern Ireland in the process.
COVID and non-EU borders are already visible for the lack of cheap workers to harvest UK crops, I've just read today in the news...

[o_e_l_e_o]

Well EU plans to start blocking anonymous wallet transaction

They say they want to do that - fine. Now, how to they propose enforcing that? If you complete KYC at a centralized exchange, then sure, it's easy to force you to complete KYC for your withdrawal addresses well. But what if you buy bitcoin peer to peer? How do they propose de-anonymizing mixed bitcoin being traded for cash to brand new addresses? And how do they plan to block transactions without forcing all miners to comply? I'm pretty sure US and Chinese miners aren't going to start blacklisting transactions because the EU tells them to.

[teosanru]

With other countries seriously considering this direction, the EU has finally start its Digital Euro (CBDC) project. It will take them 2 years to explore the potential of such a currency, and if they decide to actually apply it, they say it would take them at least 5 years to officially launch it. As an EU resident, I am not particularly excited about this, because I know that it will take them much more than 5 years to do anything, and all that time will come in handy for Bitcoin to become more mainstream in EU.

What interests me more is whether the EU will at some point start making some bad moves when it comes to Bitcoin or stablecoins, which they obviously consider competition (although they don't explicitly mention Bitcoin). Of course, this reasoning stems from the assumption that China decided to conduct a final battle with Bitcoin precisely because of its CBDC, which is already being tested on a large sample of people.

Today the Governing Council of the European Central Bank (ECB) decided to proceed with a 24-month central bank digital currency (CBDC) project to investigate the potential of a digital euro. Even if it decides to go ahead with a digital euro, the ECB President has previously stated it would take five years to launch.

While no decision has yet been made whether to issue a digital currency, the ECB and European national central banks have outlined several motivations over the last year or more. The first, as Lagarde stated, is to ensure that as cash usage declines, there is still central bank money but in a digital form. Without a CBDC, there’s a risk that private digital currencies, including stablecoins, will dominate, and they still might. Such a scenario would make it harder for the central bank to control monetary policy, maintain financial stability, ensure low cost payments and enable financial inclusion.

If the main intention behind the CDBC project is the idea that it's better to have a government-regulated cryptocurrency than a private cryptocurrency then I think it's better if there are no CDBC in near future. I don't think it's too positive for bitcoin because what governments want to do using this is to provide an alternate cryptocurrency to the user which they could use for their transaction and enjoy the benefits of cryptos but at the same time, it will be absolutely centralized. Chances are governments might decide to ban these cryptocurrencies after they have brought their CDBC, or make it a gateway currency, that nobody can buy any other crypto unless he buys the CDBC and other cryptos can be brought only through CDBC, this would make user identification from them pretty easier.

[tyz]

Their plans to create a CBDC have been around for a long time, even my developing country is already preparing for the realization of the CBDC, I read on the official Instagram of my country's central bank that they are in the research stage and it will take quite a long time.  Implicitly they did create CBDC as a form of their awareness of the development of BTC so that this will be a comparison asset for BTC that already existed before.

But if the Central Banks believe that a CBDC will stop/discourage people from buying, and using Bitcoin, then they cannot be more WRONG. I believe people HODL, and use Bitcoin because of two things, idealism, and greed. Bitcoin is censorship-resistant, and something that can still surge 10x more. CBDC can’t give you that.

Well EU plans to start blocking anonymous wallet transaction which they could literally make it a hunt for criminals not just for launderer that they usually say.

And then this CBDC although it will take a long time before they could come up perfectly, stablecoins might also be screened or banned because they think that stablecoins are going to be widely used than the CBDC.

Well the question is how they will implement this without creating a bureaucratic monster. The idea is that everyone has to know each other's identity when sending a cryptocurrency. That means you would have to know my identity if you want to send me Bitcoin. This is complete nonsense. When I make a cash payment, I don't ask the person across the street if I can see their ID before I make a payment.

[sana54210]

Well EU plans to start blocking anonymous wallet transaction which they could literally make it a hunt for criminals not just for launderer that they usually say.

And then this CBDC although it will take a long time before they could come up perfectly, stablecoins might also be screened or banned because they think that stablecoins are going to be widely used than the CBDC.

That sort of make sense when you consider the past. I mean making anonymous wallet transactions would be basically a way to hide your money from government and government only allows people who bribe them to do that, if you are not some shady bank bribing politicians at all times to keep quite about the things you do, then you will not be able to do anything illegal.

Look at the mafia world, do you really think that they are not known or can't be caught? I mean the governments of the world could end the mafia world in a day, and I mean ALL mafia all around the world, all cartels all drug lords, all mafioso everyone you can think of will be jailed within a day, millions of people all around the world, why are they not doing it? Because they are bribed that is why. So, if you want to do anything that is against the law, just bribe the lawmakers.

[stompix]

If and when the BoE launch a CBDC, will anyone outside of the UK even care?

If we exclude the British territories and countries that depend directly on British Aid, probably nobody will give a damn.
Maybe tourists?  

Perhaps it's driven by the point stompix made above. If the Fed comes out with a proposal for a CBDC, then they have to take it to Congress and get it to pass a vote. If the ECB comes out with a proposal for a CBDC, then it has to be disseminated to 19 (or is it all 27?) member states, any one of which could veto it. They need to be sure they get it right or it'll never pass.

It's a CBDC tied to the euro, so it will be a question of the Eurozone 19, not of the whole EU, but the voting things still stand as I said before, any country could veto it at any time, plus I just read an article on how some countries have it in the law (or constitution) that the euro is the only legal currency, but the wording is so bad that it will need a re-write to accommodate a digital currency, Germany was given as an example but I really didn't get it, the quote was something like "euro banknotes are the only unrestricted legal means of payment" so assumingly this would need to be changed also in short, More headaches!

5 years is too long. they'd be taken over already by the adoption of stablecoins before they could test out to one city in their country. Chinese CBDC may have already spread out in a matter of months even in Africa.

I've read some news like that at the start of the year but it was just rumors and what-if questions, and then there was silence, anything new?

[STT]

China certainly wants to establish its own trade routes that have no need to go via dollar settlement.    They lack oil which is settled in dollars but they've been net buyers of gold for a couple decades, they must have long term ambitions to act independently.

UK sterling as part of global reserves is about 8% I think, its not significant globally for trade in many sectors but it has some continued ongoing historical relevance financially as many of contracts are settled in London, insurance and the commonwealth is some dynamic not an actual alliance just common ground from shared heritage to some extent is an unrated advantage.
   The problem with alot of the modern western currencies is they dont really deserve any association with the concept of a stable coin, if you link to these FIAT standards then it will be increasingly politics not so much trade based due to excessive liquidity, debt, fiscal deficits.   We're looking towards increasing instability from the effects of those gaps in economies growing not reducing, so to some extent every modern currency is over stated in its importance and by design they are running value into the ground in order to counter debt costs; stability in that sense is a certain course towards value lost.

[crypticj]

Why they need 24 months for digital euro? Is it so hard to create gov level blockchain?

[o_e_l_e_o]

that nobody can buy any other crypto unless he buys the CDBC and other cryptos can be brought only through CDBC, this would make user identification from them pretty easier.

People either already buy from a centralized exchange after completing full KYC, in which case the government knows everything you do, or they buy peer to peer without completing KYC, in which case the government doesn't know what you are doing. That won't necessarily change with a CBDC. Those who use centralized exchanges will still have zero privacy, and those who trade peer to peer can still hide the fact they are buying and selling bitcoin from the government. The government will be able to more closely track the movement of fiat between individuals, but they will still have no mechanism for forcing those individual to report why they are moving fiat between them. You could be doing anything, from buying a car to repaying a friend.

The idea is that everyone has to know each other's identity when sending a cryptocurrency. That means you would have to know my identity if you want to send me Bitcoin. This is complete nonsense.

I think the idea is that the government knows everybody's identity. You can still give me your wallet address and I can still send you some bitcoin without either of us knowing anything else about the other, but the government want to know who is sending and receiving those transactions, even if the people doing the transacting don't.

[Wind_FURY]

Their plans to create a CBDC have been around for a long time, even my developing country is already preparing for the realization of the CBDC, I read on the official Instagram of my country's central bank that they are in the research stage and it will take quite a long time.  Implicitly they did create CBDC as a form of their awareness of the development of BTC so that this will be a comparison asset for BTC that already existed before.

But if the Central Banks believe that a CBDC will stop/discourage people from buying, and using Bitcoin, then they cannot be more WRONG. I believe people HODL, and use Bitcoin because of two things, idealism, and greed. Bitcoin is censorship-resistant, and something that can still surge 10x more. CBDC can’t give you that.

Well EU plans to start blocking anonymous wallet transaction which they could literally make it a hunt for criminals not just for launderer that they usually say.

They can, but how are they going to censor a transaction from happening? Plus I believe is many users would then avoid  to use services that require KYC to de-anonymize my transactions.

And then this CBDC although it will take a long time before they could come up perfectly, stablecoins might also be screened or banned because they think that stablecoins are going to be widely used than the CBDC.

The government will do everything to ban anything that threatens their authority, but the cat is out of the bag. Like the genie, the idea of Bitcoin can’t be pushed back into the bottle. It’s like the discovery of Electricity, that’s how ground-breaking Satoshi’s white paper is.

[perfect999]

The idea is that everyone has to know each other's identity when sending a cryptocurrency. That means you would have to know my identity if you want to send me Bitcoin. This is complete nonsense.

I think the idea is that the government knows everybody's identity. You can still give me your wallet address and I can still send you some bitcoin without either of us knowing anything else about the other, but the government want to know who is sending and receiving those transactions, even if the people doing the transacting don't.

Yeah it's the government, not people. I understand that government needs to know who sends money to who, that "sort of" makes sense, obviously it is not good for privacy and some people are very much against it, but I at least can understand it a bit.

What I do not understand however is that why people bother with it so much, are you hiding something? My government knows exactly how much I own and how much I made and I paid taxes based on that, it is not even about them sending me any information, I did it all with my accountant, I do it every month.

This includes every single thing I spend as well, since I am a freelancer I have the luxury to even claim food as expense since my home is my office so I eat at my office while eating at home, so they know basically EVERYTHING, like literally to the garbage bag level, to what I eat every day level. I do not mind, since.. like why would I care if they know it? Why would it matter if government knows I ate a bagel this morning?

[o_e_l_e_o]

What I do not understand however is that why people bother with it so much, are you hiding something?

Just because you have nothing to hide, doesn't mean you have anything you want to share. You don't need to be hiding something incriminating to want privacy; privacy is a fundamental human right. The loss of privacy leads to the loss of freedom. With zero privacy, would you behave the same way in public as you do around friends? What about when in your own house, alone? Would you feel comfortable publicly declaring every thought you think, regardless of how ashamed it makes you feel? Of course not. With zero privacy, you would quickly be reduced to the lowest common denominator, too afraid to say anything slightly out of the ordinary and too afraid to be your true self.

Everyone values privacy. Otherwise why do you have curtains on your windows? Why do you wear clothes? Why do you post on this forum from a pseudonym, rather than from your real name with your physical address in your profile?

I don't need to spend a lot of time dismantling the "nothing to hide" argument, because it is already widely discredited. I will share one of my favorite quotes on the topic though:

The old cliché is often mocked though basically true: there’s no reason to worry about surveillance if you have nothing to hide. That mindset creates the incentive to be as compliant and inconspicuous as possible: those who think that way decide it’s in their best interests to provide authorities with as little reason as possible to care about them. That’s accomplished by never stepping out of line. Those willing to live their lives that way will be indifferent to the loss of privacy because they feel that they lose nothing from it. Above all else, that’s what a Surveillance State does: it breeds fear of doing anything out of the ordinary by creating a class of meek citizens who know they are being constantly watched.

[paxmao]

If and when the BoE launch a CBDC, will anyone outside of the UK even care?

If we exclude the British territories and countries that depend directly on British Aid, probably nobody will give a damn.
Maybe tourists?  

Perhaps it's driven by the point stompix made above. If the Fed comes out with a proposal for a CBDC, then they have to take it to Congress and get it to pass a vote. If the ECB comes out with a proposal for a CBDC, then it has to be disseminated to 19 (or is it all 27?) member states, any one of which could veto it. They need to be sure they get it right or it'll never pass.

It's a CBDC tied to the euro, so it will be a question of the Eurozone 19, not of the whole EU, but the voting things still stand as I said before, any country could veto it at any time, plus I just read an article on how some countries have it in the law (or constitution) that the euro is the only legal currency, but the wording is so bad that it will need a re-write to accommodate a digital currency, Germany was given as an example but I really didn't get it, the quote was something like "euro banknotes are the only unrestricted legal means of payment" so assumingly this would need to be changed also in short, More headaches!

5 years is too long. they'd be taken over already by the adoption of stablecoins before they could test out to one city in their country. Chinese CBDC may have already spread out in a matter of months even in Africa.

I've read some news like that at the start of the year but it was just rumors and what-if questions, and then there was silence, anything new?

I do not think that is a new currency at all. It would be the equivalent to say that the Euros deposited at a bank are different from the Euros that have in your wallet. In fact these euros are more different than the ones that would be emitted as electronic since the banks are entitled to print their own money by lending more than they have in deposits. The Euro will be the Euro even if it is stored in a different way, there is no need to submit that to the 19 on those grounds. The initiative may however require a certain level of acquiescence from all the countries involved, but IMO not any constitutional changes.

[valentine wheeler]

Such a scenario would make it harder for the central bank to control monetary policy, maintain financial stability, ensure low cost payments and enable financial inclusion.

"Financial inclusion"? Please. Bitcoin is the essence of financial inclusion. Don't have good ID? Turned down for a bank account. Don't have a fixed address? Turned down for a bank account. Bad financial history? Turned down for a bank account. None of that matters with bitcoin. Install a wallet, done. No fiat or CBDC will ever be as financially inclusive as bitcoin is. And "control monetary policy" is a nice way of saying "print more money". We've all seen the chart showing USD losing >95% of its value in the last 100 years. Now here's the one for EUR - https://www.statista.com/statistics/1055948/value-euro-since-2000/. A cool 30% lost since its creation ~20 years ago. As the article points out, they are worried that the majority of the population will move to using bitcoin or other cryptocurrencies, which directly impacts on their ability to bail out themselves and their friends and prop up their rigged markets indefinitely.

This has nothing to do with maintaining "financial stability", and everything to protecting their own vested interests.

I feel that what you are talking about is the nature of the problem. Bitcoin is not worried about competition. Now the European Union or China is actively developing digital currencies. Their goals or official ideas are also obvious. Of course, the reasons sound very good.

The digital euro and digital renminbi（decp) are actually a natural world currency. It replaces the traditional currencies dominated by governments around the world and the actual circulation of physical gold. It also has the most powerful development space for currency payment functions. The function of the world currency is not affected by the fluctuation of any country’s paper currency, nor is it subject to the control of the dominant currency of any country’s government. It has a global circulation function, and it will play an irreplaceable role in the development of the world currency in the future.

What I want to ask is whether the land of fiat currencies among countries will compete with the land of digital currencies. Will there be a settlement system with a digital dollar as the core?

Regardless of development, as long as the digital currency issued by sovereign countries or regional organizations is centralized, or half of it is centralized, it has already broken away from the essence of the blockchain, and a perfect trust system cannot be established. This is the key, so it actually provides an accelerator for the development of Bitcoin.

[Kong Hey Pakboy]

Why they need 24 months for digital euro? Is it so hard to create gov level blockchain?

If you can do it less than a month then do it, there's probably a lot of factors involved in doing this project like scaling, network and integration. I don't think that the project can be any more shorter because they have to be released perfect or at least performing. I don't necessarily agree with them creating their own digital currency because I feel like once it's operational, they will start attacking the decentralized platform like what China did these past few months.

[stompix]

I do not think that is a new currency at all. It would be the equivalent to say that the Euros deposited at a bank are different from the Euros that have in your wallet. In fact these euros are more different than the ones that would be emitted as electronic since the banks are entitled to print their own money by lending more than they have in deposits. The Euro will be the Euro even if it is stored in a different way, there is no need to submit that to the 19 on those grounds. The initiative may however require a certain level of acquiescence from all the countries involved, but IMO not any constitutional changes.

Not that simple!
There is a problem with issuing euros, the ECB does not issue coins, those are done by the CB, the roles are clearly defined so unless they will only print clear denominations of CBDC that match the current values they will not be able to do it lawfully. So,
- the ECB has no current legal way of doing so, it needs a status update in order to issue currency on their own
- national banks don't have this power either, and on top of that in some of the countries, it's clearly said that they can only issue a well-defined currency and in the case of the eurozone every currency that would be issued by the CB would become legal tender and everyone in the country would be forced to accept it for payment. Not going to happen! Take a look at Germany, they simply can't stop using cash, how are you going to make them use a digital currency when they didn't want to use a debit card?

It's not as simple as you think, this Union has a lot of treaties that hold it together, and because each joining country has ratified these if one of those is broken a lot more become invalid also. Given the current mess and constant infighting updating everything will not be done without a vote, nobody is going to risk another fragmentation on this.

If, however, it were necessary to amend the treaties, in principle this would have to be done through a new treaty, with the attendant difficulties linked to the need for unanimity and ratification processes in the Member States. Exceptionally, under a derogation in Article 129(3) of the Treaty on the Functioning of the European Union (TFEU), the Statute of the ESCB and of the ECB can be amended using the legislative procedure. However, the derogation is restricted to a limited number of Statute articles, including Article 17 on opening accounts, and authorises only marginal amendments to the content of the articles. Making wholesale changes to the content of one of the articles covered by the derogation might, in particular, be viewed as circumventing the restrictive nature of this procedure.

and the legal tender part:

As the law stands, only banknotes issued by the Eurosystem (TFEU Article 128) and coins (Article 11 of Council Regulation EC/974/98) are legal tender in the euro area. Assuming that it was possible, given the constraints detailed above, to introduce a retail CBDC that was equivalent to a digital form of banknotes, under TFEU Article 128, it would automatically benefit from legal tender status.