The European Central Bank (ECB) just approved the next phase of the digital euro project, aiming to launch a central bank digital currency (CBDC) in 2029.
The decision from the Governing Council follows a two-year preparation phase that finalized key designs and partnerships.
The ECB says the digital euro will act as a free complement to cash, enabling resilient person-to-person and retail payments across Europe.
Technical analyses to date has focused on privacy-preserving architecture, accessibility for vulnerable users, and holding limits of €500 to €3,000 in an effort to ensure the CBDC poses no major financial stability risks.
The central bank says the project is designed to address declining cash use, which is now at 24% of daily payments, as well as Europe’s reliance on non-EU methods for two-thirds of card transactions.
Critics argue the digital euro prioritizes protecting banks over broader goals like payment competition. They also question potential privacy violations and whether a digital version of the euro could ever equal the privacy protections inherent in paper money.
Estimated development costs total €1.3 billion until issuance, with annual operations at €320 million.
Next steps include pilots from mid-2027, pending 2026 legislation, to boost payment autonomy and inclusion.
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