The digital euro is necessary to strengthen Europe's financial and strategic independence, as it will complement physical cash and provide safe, inclusive, and efficient conditions for payments in the digital age. This is stated in a joint position by Piero Cipollone, a member of the Executive Board of the European Central Bank (ECB), and Valdis Dombrovskis, European Commissioner for Economy and Productivity, in an article published on the ECB blog.
From bartering to coins, banknotes, and cards, the payment systems used by Europeans have been constantly evolving. Innovation has always contributed to making these systems more sophisticated, efficient, and convenient. Today, technology is changing our society with exceptional speed. Therefore, it is quite natural that our currency should also adapt. Europe needs a digital euro for the digital age.
For now, the euro in cash exists only in physical form – the banknotes and coins in our wallets. As the most tangible manifestation of our single currency, cash unites us. We know we can rely on it. It is accepted everywhere in the euro area. It is easy to use and inclusive. It protects privacy. These are our money, issued by a public institution – the European Central Bank.
However, more and more Europeans choose to pay digitally in stores or shop online. Therefore, we need a digital form of cash that complements the banknotes and coins we know. The digital euro is designed to address the opportunities and challenges posed by this transition.
This is the goal of the single currency package presented by the European Commission in 2023. It presents two proposals, which are currently being discussed by European legislators.
The first aims to ensure that citizens and businesses can continue to have access to euro banknotes and coins and pay with them throughout the euro area. In parallel, the ECB is developing the next generation of euro banknotes with a new design to make them more attractive, more recognizable, and more inclusive for all Europeans, while ensuring that they remain as secure and durable as possible. Euro coins and euro banknotes will not disappear. European citizens will have a choice of whether to pay with them or with the digital euro. The digital euro is intended to complement, not replace, cash.
The second proposal defines a framework for the digital euro. It ensures that it will be used free of charge and easily and will be inclusive. The digital euro will be accepted for all digital payments in the euro area and will meet the highest standards for the protection of privacy, similar to cash. It will be able to be used online and offline, supporting digital payments on websites as well as making transactions without an internet connection.
In addition, the digital euro should be considered in the broader context of the need to increase Europe's strategic independence. Our payments are now dominated by payment service providers outside Europe. We lack a European digital means that can be accepted for all digital payments anywhere in the euro area and can fill the void of the declining use of cash.
Ultimately, this makes us dependent on foreign companies in an increasingly polarized and fragmented world. The fact that we are ceding technological control over the EU economy to others to such an extent seriously hinders Europe's ability to act independently on the world stage. Real threats are emerging to our resilience and the security of our economy. Therefore, we must act to reduce external dependencies that could impede our freedom to pursue policies that are in line with our own values and interests.
The digital euro will not compete with private payment instruments. It will complement them, making it easier for private European payment options to develop and expand their scope and offered services.
The coming year, 2026, will be crucial for the digital euro project. At a recent summit, the leaders of the euro area countries welcomed the progress made. They also emphasized how important it is to complete the work on legislation quickly and to accelerate other preparatory steps. The ECB is preparing for the possible issuance of the digital euro by 2029, provided that the necessary legislation is adopted next year. The preparation will include a pilot phase, which is expected to begin in 2027.
The euro has become a symbol of Europe's economic power and our unity on the world stage. In 2026, the euro area will welcome its twenty-first member state – Bulgaria. The currency, which will be the driving force of prosperity for 21 countries in the euro area, must now take full advantage of 21st-century technologies.
The digital euro is an idea whose time has come. It is not just another step in the development of our money, but an integral part of asserting our strategic independence and making the most of the opportunities of the digital age.