The Council of the European Union has supported the launch of a central bank digital currency (CBDC), explaining its decision by the ability of the digital euro to increase the security and stability of the economic and political union of 27 countries of the Old World.
The legal framework, design, and key features have now been agreed upon: online and offline availability, high privacy, complementarity to cash, and limits on storage amounts to avoid pressure on banks.
Key aspects of the digital euro:
- will operate both online and offline;
- will ensure a high level of privacy, similar to cash;
- will function in parallel with national and private payment methods;
- To prevent the outflow of deposits from commercial banks, limits will be set on the amount that can be stored.
- Basic transactions (transfers, top-ups) will be free of charge for users.
The legislative initiatives still need to be finally approved by the European Parliament. Only then will the European Central Bank be able to move on to implementation, with a pilot launch of the digital euro tentatively scheduled for 2027 and full implementation by 2029.
Reference:
The digital euro is a digital form of central bank money (Central Bank Digital Currency) that will be available to citizens and companies for making payments. Unlike cryptocurrencies, the digital euro will be issued and guaranteed by the ECB, similar to cash euros. It also differs from stablecoins, which are usually issued by private companies and pegged to fiat currencies. The goal is to provide access to safe, efficient, and universally accessible central bank digital money in the digital age.
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