On 22 June 2026, the European Parliament’s ECON committee adopted a negotiating mandate for the digital euro by 43 votes to 14, paving the way for final negotiations with the Council and bringing closer the issuance of the first central bank digital currency in the euro area, with a realistic circulation date estimated for 2029.
On 22 June 2026, the European Parliament’s ECON Committee adopted its negotiating mandate on the digital euro. We examine the prospects for implementation by 2029, how individual member states view the project, and the main fault lines.
What is the digital euro and why the ECB wants it
The digital euro is a central bank digital currency issued directly by the European Central Bank and designed for everyday retail payments. It would complement, not replace, cash and existing private payment instruments such as credit cards, payment apps, and instant transfer systems. The key distinction from commercial bank money is that the digital euro would be a direct liability of the central bank — an institution that cannot go bankrupt, backed by the state, just like cash.
The motivation of the ECB and the European Commission is both technological and geopolitical. Visa and Mastercard, two US-headquartered firms, process 61 percent of card transactions in the euro area and nearly all cross-border payments, according to ECB data. Donald Trump’s return to the White House and his confrontational trade policy in 2025 have noticeably accelerated discussions about Europe’s digital sovereignty. At the same time, the United States is giving private stablecoins regulatory room through the GENIUS Act, while China is rolling out its digital yuan on a large scale. In this context, the digital euro project is an answer to the question: does Europe want to retain control over its own currency in the digital payments era, or cede that space to non-EU players?
The project covers both an online mode, based on a user account with a payment service provider, and an offline mode, designed to work like cash: payments via a local device with no internet connection and no central system verification. Losing the device in offline mode would mean losing the stored funds, just like losing a wallet full of banknotes.
The digital euro would be free for consumers in terms of basic services, accepted across the entire euro area, and also available to citizens from non-euro countries travelling to the EU. It would not accrue interest and would carry no storage costs. Businesses could accumulate incoming payments for a maximum of 24 hours but could not maintain a balance in digital euros.
From proposal to potential issuance: six years of work
The digital euro project has gone through six years of formal analytical and preparatory work. The European Commission submitted its legislative proposal in 2023. The Council of the EU, representing member state governments, adopted its position in December 2025. On 22 June 2026, the European Parliament’s ECON Committee adopted its negotiating mandate by 43 votes in favour, 14 against, and 1 abstention. The next step is the trilateral negotiations between Parliament, Council, and Commission, known as trilogues.
The legislative process in the European Union rarely runs to schedule, but in this case there is strong political will to close the file before the end of 2026. Otherwise, the prospect of issuance in 2029 may prove unrealistic. The ECB is already preparing the technical infrastructure, but without a full regulation it cannot take the final decision to issue.
How the European Parliament voted
The Economic and Monetary Affairs Committee (ECON) of the European Parliament adopted its negotiating mandate for talks with the Council on 22 June 2026. The vote covered three documents making up the single currency package. The proposal to establish the digital euro received 43 votes in favour, 14 against, and 1 abstention. Provisions on access to the digital euro for non-euro area countries passed by 43 to 9 with 6 abstentions. The regulation on the legal tender status of cash received the broadest support: 46 in favour, 4 against, and 8 abstentions.
The ECON vote was largely cross-party – in favour were members of the European People’s Party (EPP), the Socialists & Democrats (S&D), and the Renew Europe group. Those voting against were mainly from the far-right factions (ECR and ID), arguing that the digital euro could lead to state surveillance of citizens’ spending and weaken financial privacy. The sole abstention came from a Green MEP, who called for even stricter privacy safeguards than those proposed in the mandate.
The mandate adopted by ECON is a substantial document – running to several dozen pages – covering not only technical issues but also consumer rights, payment service provider obligations, and the relationship between the digital euro and cash. Parliament backed a holding limit set by the Commission but after consultation with the EP and the ECB – a compromise between the Council’s version (exclusive Commission powers) and the demands of some MEPs (who wanted a decisive Parliamentary role).
The ECON vote is a significant step, but not the final one. The mandate must still be announced at the EP plenary session in early July 2026, after which the trilateral negotiations with the Council begin. Only after a trilogue agreement and a full plenary vote of the entire Parliament will binding law be created, authorising the ECB to decide on issuance. In practice, this means the final regulation may differ from the ECON mandate, as the Council has its own, often more conservative, stance on fiscal matters.
Three issues dividing countries and institutions
The digital euro project does not face fundamental opposition in most member states or EU institutions regarding its overall purpose. The controversies concern the detailed parameters of the project, which are crucial for its actual functioning. Three main axes of disagreement can be identified.
The first and most important fault line is privacy. In the public consultations conducted by the ECB before the legislative proposal was submitted, 43 percent of respondents identified privacy as the most important feature of the digital euro. This result was consistent across all countries, demographic groups, and professional backgrounds. The current legislative proposal enshrines privacy by design, based on privacy-by-design and privacy-by-default principles, using zero-knowledge proof technology to verify transactions without revealing personal data. Neither the ECB nor national central banks would have access to users’ identifying information. Critics point out, however, that even advanced cryptographic technologies do not eliminate the risk of abuse by payment service providers, who would effectively be the interface between the user and the system. Green and left-wing parties in the EP are calling for full anonymity for offline transactions up to a certain amount, similar to cash, while central banks and the Council favour the ability to trace transactions to combat money laundering and terrorist financing.
The second fault line is the holding limit, or cap. The Commission’s proposal would set this limit by the Commission based on an ECB recommendation, with a review at least every two years. The EP wants full decision-making power in this process – a fight for democratic control over the project. Commercial banks are lobbying for a low limit, fearing deposit outflows to digital euro accounts. Economists point out that too low a limit would make the currency impractical and defeat the project’s purpose, while too high a limit could destabilise the banking sector. Discussed values range from €500 to €3,000 per person. The ECON mandate proposes that the limit be set by the Commission but in close cooperation with the EP – an attempt to find a compromise between the different positions.
The third fault line is the offline mode. Offline payments would work without network connectivity, raising questions about security against double-spending, legal liability in case of device loss, and the technical infrastructure that payment service providers would have to maintain. The EP included in its mandate a requirement that the ECB must clearly regulate liability issues in offline mode before the system goes live. Central banks in countries such as Germany and Austria, where cash is still widely used, are insisting on robust offline solutions to ensure the digital euro becomes a real alternative to banknotes, particularly in regions with poor internet coverage.
How individual countries view the digital euro
Member states’ positions on the digital euro are varied, reflecting different national priorities, financial sector structures, and traditions of central bank independence. It is worth noting that none of the 27 countries has openly opposed the idea of a digital euro itself; rather, differences concern the speed of implementation, project parameters, and the decision-making powers of various institutions.
Among euro-area countries, the greatest enthusiasm comes from France, Italy, and Spain – countries with strong traditions of state interventionism that view the project as part of building European sovereignty. Their central banks are actively participating in the ECB’s technical work. Germany and the Netherlands, while supportive of the idea, express reservations about privacy and the holding limit – their citizens place a high value on data protection and cash. Austria, due to its strong cash preferences, is making a functional offline mode a condition of its support.
Non-euro countries such as Poland, the Czech Republic, Hungary, and Denmark are not directly obliged to adopt the digital euro, but the project may still have significant implications for them. Banks in these countries will be able to offer digital euros to their clients if they meet certain regulatory requirements. In practice, this means the digital euro could become a second form of central bank money, alongside cash, available across the entire Union, thus affecting competition in the payments market even outside the euro area.
Poland is not in the euro area and is not obliged to adopt the digital euro after its issuance. However, the regulation allows banks and payment service providers from non-euro EU countries to distribute the digital euro, subject to the same rules as euro-area institutions, while designating a national supervisory authority. This means Polish banks could offer digital euro services to their customers. Moreover, individuals and businesses based outside the euro area can access the digital euro through a provider registered in the euro area or the EEA. Debate in Poland about the digital euro has been limited, however, as domestic attention is focused on other macroeconomic issues, and euro adoption itself still seems distant.
| Country | In euro area | Stance |
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Source: own compilation based on central bank positions and government statements from January – June 2026.
Why commercial banks are against it
The loudest and most organised opposition to the project comes not from member states but from the banking sector. In April 2026, at an industry meeting in Brussels, Daniel Baal, head of the French Banking Federation, publicly criticised the project, saying the digital euro in its current form distorts the existing financial ecosystem. The European Banking Federation has from the outset of the legislative process pushed for high holding limits and restrictive rules that would prevent a mass exodus of deposits.
Banks’ concerns have a solid economic foundation. If citizens transferred a significant portion of their savings from commercial bank deposits to digital euro accounts at the ECB, it would reduce the banking sector’s deposit base and its lending capacity. The ECB counters that a sufficiently low holding limit (the original proposals mentioned €3,000) and the lack of interest on digital euros would effectively limit this effect. Commercial banks remain sceptical, pointing out that even with a cap, during a financial crisis consumers could massively shift funds to the digital euro as a safer form of money, potentially destabilising the banking system.
In recent months the banking sector has intensified its lobbying, sending detailed economic analyses to MEPs and governments showing that with a €3,000 holding limit, between 5 and 8 percent of household savings in the euro area could flow out of bank deposits. Although the ECB disputes these calculations, arguing that the lack of interest and functional limitations will ensure the digital euro is seen purely as a means of payment rather than a savings vehicle, banks have already convinced some governments (especially Germany and the Nordic countries) to back a cap of no more than €1,000. This divergence will be a key point in the trilogues.
Visa and Mastercard handle 61 percent of card transactions in the euro area. For the ECB, this is not just a statistic – it is an argument for Europe’s monetary sovereignty.
The digital euro against global CBDCs
The digital euro is not a pioneering project on a global scale. China has been developing its digital yuan (e-CNY) on a large scale since 2020, running pilots in dozens of cities with tens of millions of users. The Bahamas launched the Sand Dollar in 2020 as the world’s first fully operational CBDC system. Nigeria, Jamaica, and several Caribbean countries have their own CBDC systems. India has been testing the digital rupee since 2022, and Brazil is conducting advanced work on Driex.
The United States has chosen a different model: instead of a Fed-issued CBDC, the Trump administration in 2025 decided to regulate private stablecoins through the GENIUS Act, creating a framework for dollar-denominated tokens issued by private entities. This is a strategically opposite choice to Europe’s. The EU is betting on a public central bank currency, while the US is giving private dollar-linked issuers room to operate. Fifty-seven countries representing 95 percent of global GDP are actively working on CBDCs, according to 2025 data. These include both developed economies (the UK, Japan, South Korea) and emerging markets (India, Brazil, South Africa).
The diversity of CBDC approaches worldwide shows there is no single optimal model – each country tailors the project to its own needs. Europe has chosen a regulatory path with a strong emphasis on privacy and consumer rights, which distinguishes the digital euro from more centralised Chinese solutions. At the same time, the ECB is working to ensure interoperability with other countries’ payment systems, so that the digital euro can be used in international transactions – a key factor in maintaining the euro’s role as a reserve currency.
Charts show estimated data for 2025 based on ECB and Bank for International Settlements reports. Percentages may not sum to 100 due to rounding.
Digital euro: likely, but not certain by 2029
Following the ECON vote of 22 June 2026, the digital euro project enters the trilogue phase between Parliament, Council, and Commission. The EP mandate is clear, the Council position is set, and the political will at the level of euro-area heads of government clearly supports a swift conclusion to the legislative work. If trilogues are finalised by the end of 2026, the ECB could move to a pilot in 2027 and issuance in 2029.
Risks remain in the details of the negotiations, particularly the holding limit and Parliament’s powers to control it, which could delay agreement. The banking sector continues to exert strong lobbying pressure for restrictive parameters. Privacy remains politically sensitive, with parties across the European Parliament’s political spectrum – from the conservative EPP to left-wing groups – voicing concern about potential surveillance by the central bank.
Assessing the project’s realism, Industry Alarm identifies four key observations. First, the political decision is essentially made – the obstacles are technical and regulatory, not ideological. Second, the geopolitical pressure from the dominance of Visa, Mastercard, and potentially dollar-backed stablecoins is an argument that grows stronger by the month. Third, 2029 as an issuance date is realistic only if trilogues are smoothly concluded by the end of 2026, which in EU legislative reality is not guaranteed. Fourth, issuance alone will not guarantee success without mass consumer adoption – the digital euro will need to offer real advantages over existing payment methods.
In the long term, the digital euro could become a major tool for integrating EU financial markets, but its success will depend on citizens’ trust. The ECB is aware that to win over Europeans it must ensure not only technical security but also transparency and democratic oversight of the system. That is why the ECON mandate includes provisions for an annual report on the system’s operation to the European Parliament, and for the possibility of suspending issuance if serious threats to financial stability are identified.
In summary, the digital euro has a real chance of entering circulation in the 2029–2030 horizon, provided the interinstitutional negotiations do not get stuck. The current political dynamics favour a swift agreement, but in the European Union many similarly scaled projects have foundered on the details. In the coming months, the stance of Germany and France will be crucial – despite their differences, they are capable of forging a compromise that would carry the other member states along. If that happens, 2029 will become a real target, and the digital euro will transform the payments landscape in Europe.
Fot. Unsplash
