Worries about the digital euro force Slovakian authorities to pass cash use reform.
To preserve its monetary sovereignty amidst the growing interest in digital currencies, Slovakia has decided to stamp the use of physical cash as a method of payment in its constitution. The decision followed a parliamentary vote on June 15th.
This latest legislation, sponsored by the "We Are Family" party, also known as the Sme Rodina party, was formulated as a safeguard against the impending digital euro.
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As reported by Euractiv, a European news agency, lawmaker Miloš Svrček, who co-authored the legislation, emphasized the significance of this move during a parliamentary discussion. He stated:
It is very important that there is a provision in the Constitution based on which we can defend ourselves in the future against any orders from the outside, saying there can only be digital euro and no other payment options.
Alongside the new law ensuring the constitutional right to use cash, another constitutional amendment is being prepared.
The second legislation aims to reinforce the rights of shopkeepers to decline cash payments for goods and services. The rationale behind this move is to safeguard merchants from theft risks and potential exposure to germs.
The notion of a central bank digital currency (CBDC), or a digital euro, has been an area of intense exploration for the European Union. A recent analysis conducted on behalf of the parliament described the idea as a "solution looking for a problem" but simultaneously encouraged the EU to be ready to explore this avenue in the future.
The centralization of a digital euro and the potential for a single governmental entity to govern all transactions made with it is one of the key issues surrounding its development and deployment. Some experts argue this could pose an inherent risk to individual privacy.
The proactive steps taken by Slovakia highlight the country's efforts to balance the evolving financial landscape while preserving its citizens' right to choice and protecting their privacy.
In other EU-related news, ESMA launched a tripartite consultation process concerning the recently approved Markets in Crypto-Assets (MiCA) framework.
