joachim nagel : digital euro - vision, advances and challenges introductory remarks by dr joachim nagel, president of the deutsche bundesbank, at the fireside chat with massachusetts institute of technology students, cambridge, massachusetts, 16 april 2024. * * * check against delivery 1 introduction ladies and gentlemen, i am very pleased to be here with you today. as a macroeconomist and a central banker, i am delighted to be visiting the world's most famous technical university. the place where paul samuelson, one of the fathers of modern macroeconomics, worked. where his assistant robert c. merton developed the foundations of modern option pricing theory. economists and central bankers currently have a particularly keen interest in the mit digital currency initiative ( dci ), which conducts intensive research on blockchain technology and digital currencies. one of the reasons for the bundesbank's interest is that dci research includes central bank digital currencies. these cbdcs are the topic of my talk and our chat. as you probably know, the eurosystem is currently considering the introduction of the digital euro as a european central bank digital currency. first, i would like to touch upon our vision for a digital euro and explain the goals behind it. second, i will briefly summarise our current work on this project. and finally, i will set out possible challenges that could emerge if the digital euro is put into circulation. but before i start, i am delighted to announce that the bundesbank und the mit dci have agreed to cooperate in the field of cbdc. the main focus will be research on pivotal design questions such as the implementation of data protection and privacy in a cbdc system – a topic that many citizens care a lot about, not the least in germany. 2 our vision for a digital euro let us now take a look into the future. why do we need a central bank digital currency? what is our rationale for a digital euro? in my view, it is quite simple. first, our world is becoming increasingly digital, hence central banks must follow suit. the ongoing digitalisation affects the way people pay for things, in particular. eight years ago, for example, one out of five over - the - counter sales transactions was a card payment. two years ago, this had increased to one out of three, as shown by a recent ecb study on the payment attitudes of consumers in the euro area. 1 as payments are becoming

place take into account the need to safeguard the integrity of the financial system. 12. in november 2011, parliament enacted the national payments system act. this act provides cbk with oversight of the national payments system. it aims to bring all payment service providers including mobile phone service providers offering money transfer services, within one regulatory framework. going forward, the inclusion of these mobile phone service providers within the supervisory and regulatory scope of cbk will no doubt enhance the country ’ s aml / cft measures. 13. it is my hope therefore, that this conference and the initiative being launched by the financial services volunteer corps will contribute to a greater understanding of the subject and will generate frontier ideas of enforcing and enhancing aml / cft measures. 14. it is now my pleasure to invite the permanent secretary, ministry of finance, bw. joseph kinyua, to officially open this conference. thank you bis central bankers ’ speeches