The Economist covered Bitcoin reaching $50,000 with a story that touched on the digital euro. They noted that such a Euro-CBDC might bolster the international role of the euro (only a third as much is held in international reserves as the dollar, which dominates) and that such a system would be faster, cheaper and safer than sending euro payments through the current network of “correspondent” banks. They were kind enough to quote me on one interesting area of potential differentiation:
Its main draw may be to offer a level of privacy that neither America nor China can promise, says Dave Birch, a fintech expert.
America uses its financial system to enforce sanctions, China seeks control: but a European alternative that balanced the legitimate requirements of law enforcement and European principles of privacy (think GDPR for money) might be a globally desirable option. As I explained to the journalist, one way forward might be to use digital identity and pseudonymous wallets, with regulated financial institutions providing the links.