Privacy and Transparency in CBDCs: A Regulation-by-Design AML/CFT Scheme

anonymity; anti-money laundering; central bank digital currency; compliance.; criminal activities; cryptocurrency; Distributed ledger; Internet; Law; law and technology; policy; Privacy; regulation; risk management; Stakeholders; Task analysis; Terminology

Abstract :

[en] Central banks and governments all over the world are increasingly exploring digital versions of fiat money, known as retail Central Bank Digital Currencies (CBDCs). Most initiatives rely on Distributed Ledger Technologies and are presented as alternatives to physical cash. Consequently, anonymity-related regulatory questions have naturally started to arise in terms of Anti-Money Laundering and Counter-Terrorist Financing compliance. Against this backdrop, this paper provides a techno-legal taxonomy of approaches to balance privacy and transparency in CBDCs without thwarting accountability, but it also underlines cross-sectoral impacts. The contribution heeds regulation-by-design as its core methodological foundation, with Privacy-Enhancing Technologies as the relevant use case. Thus, it highlights that not only technology aids legal purposes, but also that some regulatory requirements ought to be designed into technology for one to reach agreed-upon results and/or standards.

Disciplines :

Engineering, computing & technology: Multidisciplinary, general & others

Author, co-author :

POCHER, Nadia ; Universitat Autònoma de Barcelona ; Alma Mater Studiorum Università di Bologna ; Katholieke Universiteit Leuven - KUL

Veneris, Andreas

External co-authors :

yes

Language :

English

Title :

Privacy and Transparency in CBDCs: A Regulation-by-Design AML/CFT Scheme

Publication date :

June 2022

Journal title :

IEEE Transactions on Network and Service Management

ISSN :

1932-4537

Publisher :

Institute of Electrical and Electronics Engineers, New York, United States - New York

Volume :

Issue :

Pages :

1776--1788

Peer reviewed :

Peer Reviewed verified by ORBi

Additional URL :

https://ieeexplore.ieee.org/document/9657055

European Projects :

H2020 - 814177 - LAST-JD-RIoE - Law, Science and Technology Joint Doctorate: Rights of the Internet of Everything

Funders :

CE - Commission Européenne [BE]
Union Européenne [BE]

Available on ORBilu :

since 08 July 2023

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