Central Bank Digital Currency Privacy

A common misconception about central bank digital currencies (CBDCs) is that privacy can’t exist while transacting, which makes many citizens anxious about general-purpose or retail CBDC. In fact, transaction privacy is such a big factor for potential users that it was the top concern among respondents in the CBDC survey that the European Central Bank (ECB) conducted last Fall.

According to the ECB’s January 13th press release, “an initial analysis of raw data shows that privacy of payments ranked highest among the requested features of a potential digital euro (41% of replies), followed by security (17%) and pan-European reach (10%).”