EU Moves Forward With ECB Digital Euro Proposal

The European Parliament has backed a digital euro with both online and offline functionality, aligning with the European Central Bank’s vision and setting the stage for a potential 2029 launch.

Key Takeaways

• European Parliament approved support for a digital euro with both online and offline capabilities.
• The move aligns with the European Council and boosts the ECB’s timeline for a 2029 launch.
• The digital euro aims to reduce EU reliance on US firms like Visa and Mastercard.
• Political divisions remain, but broad support across parties signals growing momentum.

What Happened?

The European Parliament has voted to support the creation of a digital euro with both online and offline capabilities, aligning with the European Commission and Council’s proposals. This marks a turning point in the EU’s pursuit of a central bank digital currency (CBDC) and brings the ECB’s long-term vision of a 2029 rollout closer to reality.

This decision comes after months of internal debates and growing concerns over Europe’s dependence on non-European payment systems in a rapidly digitizing global economy.

Parliament Backs Broader Digital Euro Scope

The Parliament’s decision to endorse both online and offline functionality breaks with earlier, more conservative proposals that would have limited the digital euro to offline use only. The shift is significant because it aligns with the ECB’s stance that dual functionality would more closely resemble cash and enhance accessibility.

• The amendment passed Tuesday emphasizes that the digital euro is “essential to strengthening EU monetary sovereignty” and “reducing fragmentation in retail payments.”
• The proposal envisions a digital wallet that allows users to pay in both connected and disconnected environments, with privacy protections baked in.

Pasquale Tridico, MEP from Italy’s Five Star Movement and a vocal supporter, said delays and political resistance are “counterproductive” and warned against continued dependence on US payment giants.

Tridico told Euronews:

From Gridlock to Growing Support

The Parliament’s position paper was originally stuck in gridlock due to ideological splits among political groups. The lead rapporteur, Fernando Navarrete, had pushed for a limited offline-only version, arguing that private firms could handle online digital payments. His proposal was met with resistance from the ECB and ultimately overridden.

However, the latest vote revealed a shift in the political landscape:

• Lawmakers from across the spectrum, including the European People’s Party, Socialists and Democrats, Renew Europe, Greens, and The Left supported the amendment.
• Even Italy’s ruling party, Brothers of Italy, pledged support despite some far-right parties opposing the initiative.

The amendment was approved as part of the Parliament’s resolution on the ECB’s 2025 annual report, signaling increasing consensus ahead of final negotiations.

Road to 2029: What Comes Next?

Although the Parliament’s vote is not legally binding, it offers strong political validation of the ECB’s efforts and gives momentum to legislative drafting.

• The ECB still requires a full legal framework before issuing the currency.
• A pilot phase could begin in 2027, with a potential full launch in 2029 if agreement is reached between Parliament and national governments.

Experts say this endorsement is crucial. Laura Casonato of Positive Money Europe called the vote “a big win”, adding that the digital euro would provide a safe, public form of digital money similar to cash.

CoinLaw’s Takeaway

I found this vote especially important because it shows that Europe is waking up to its vulnerability in the global payment landscape. As someone who’s followed CBDCs for years, it’s clear the EU is no longer just exploring digital currency as an innovation project. They now see it as a strategic necessity. The overwhelming reliance on Visa and Mastercard has always been a quiet Achilles’ heel for the continent. The digital euro could finally give the EU a sovereign payment tool that reflects its values of inclusivity, privacy, and resilience. In my experience, this kind of bipartisan political support doesn’t come easy, which tells me the tide has truly turned.

The post EU Moves Forward With ECB Digital Euro Proposal appeared first on CoinLaw.