Cash-Level Privacy Is Digital Euro's Toughest Tradeoff, Experts Say
Policy and technical experts say the defining political choice for the digital euro is whether to preserve cash-level privacy or prioritize a feature-rich, fully online instrument with strong traceability. Parties in Brussels and national capitals are clashing over offline functionality, transaction limits, and data minimization; regulators warn that too much anonymity could hamstring AML/CFT enforcement, while privacy advocates say heavy surveillance would undermine public trust and adoption.
The outcome matters because it will shape core design decisions — from tiered limits and cryptographic privacy tools to backend access for authorities — and could delay the project or push users toward private alternatives. With lawmakers and central bankers negotiating tradeoffs, the digital euro’s eventual balance of privacy and oversight will signal how European payments evolve and whether the currency can win broad public acceptance without compromising regulatory goals.