2022-3: "Central Bank Accounts are Dangerous and Unnecessary" published
In December 2021, the European Central Bank (ECB) published a report on ``Central
Bank Digital Currency: functional scope, pricing and controls'' in its
Occasional Paper Series, detailing various challenges for the
Digital Euro. While the authors peripherally acknowledge the existence of
token-based payment systems, the notion that a Digital Euro will somehow
require citizens to have some kind of central bank account is pervasive in the
paper. We argue that an account-based design cannot meet the ECB's stated
design goals and that the ECB needs to fundamentally change its mindset when
thinking about its role in the context of the Digital Euro if it wants the
project to succeed.
Along the same lines, the French National Council for Digitalization published a report on ``Notes and Tokens, The New Competition of Currencies''. Here, the authors make related incorrect claims about inevitable properties of Central Bank Digital Currencies (CBDCs), going as far as stating that a CBDC is not possible without an eID system. Our paper sets the record straight.