The European Central Bank has announced the development of proof-of-concept for CBDC, central bank issued digital currency.

In the report “Exploring anonymity in central bank digital currencies”, central bank argues that the proof-of-concept proves the technical possibility “to balance an individual’s right to privacy with the public’s interest in the enforcement of AML/CFT regulations” by adapting two-stage system for different amounts of transaction:

“The proof of concept drawn up by the ESCB demonstrates that it is possible to construct a simplified CBDC payment system that allows users some degree of privacy for lower-value transactions, while still ensuring that higher-value transactions are subject to mandatory AML/CFT checks”

The proposed system is based on four main principles: CBDC has cash-like features, the design is built around intermediaries, central bank controls the issuance of digital money, “AML authority” performs checks for higher-value transactions.

The proof of concept has been developed using platform Corda in cooperation with consulting firm Accenture. It featured digitalised solutions for AML/CFT checks, while anonymity is being achieved with so-called “anonymity vouchers”, or the right to transfer limited sums without any checks for a certain period of time.

In their report, authority also highlighted potential “areas where there is room for improvement”, including scalability of the solution. Central bank also shared plans to further explore “the benefits of new technologies <…> in order to be ready to act should the need arise in future”.


As Future Time reported earlier, Turkish government will pilot the national digital currency by the end of 2020.