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The Eurozone, or Euro Area, is in the pilot phase. The European Central Bank has been researching the possibility of issuing a CBDC (referred to as a digital euro) for over five years. It announced in October 2023 that it would push forward to the next phase of its CBDC research after the past two years of broad investigations. This next phase, what is being called the preparation phase, will include establishing a legal framework, selecting technology providers, and building the infrastructure. In June 2024, the European Central Bank announced that it was working on and expanding a wholesale CBDC pilot.
The Eurozone includes Austria, Belgium, Croatia, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia, and Spain. However, member countries are tracked separately due to varying projects that individual countries are leading. With that said, if the European Central Bank launches a CBDC, then all members will be moved to the launch phase.
The European Central Bank published a note in December 2019 announcing the push for a CBDC in the Eurozone. The note said, “[The] ECB finds that the time has come to provide new impetus to European retail payments, building on past achievements such as the Single Euro Payments Area (SEPA). … For its part… the ECB will also continue to assess the costs and benefits of issuing a central bank digital currency (CBDC) that could ensure that the general public will remain able to use central bank money even if the use of physical cash eventually declines.” The note concluded: “Prospects of central bank initiatives, however, should neither discourage nor crowd out private market-led solutions for fast and efficient retail payments in the euro area.”
The European Central Bank and Bank of Japan collaborated on a joint research project called “Stella.” Although the project officially began in December 2016, the project did not mention CBDCs until February 2020. When it turned its attention to CBDCs, the project only said that its research on privacy-enhancing technology could be applied to CBDCs and cryptocurrencies.
The European Central Bank hosted a “Civil Society Seminar” in December 2020. The meeting outlined the central bank’s vision for a CBDC. Although it said a “digital euro [is] not necessary so far,” the central bank said that it wanted to investigate the space because of the rise of cryptocurrency and the decline of cash. When an audience member asked what value a CBDC would bring aside from being “risk free,” the European Central Bank was only able to say the CBDC would be risk free.
Speaking at an event in November 2022, European Central Bank president Christine Lagarde outlined the central bank’s stance on CBDCs. She argued that a CBDC is needed because people are using cash less, “new kinds of digital assets could harbor instability and confusion among citizens about what is money and what is not,” and “more than two thirds of European card payment transaction are run by companies with headquarters outside the European Union.” Although she recognized the privacy concerns that surround CBDCs, Lagarde said, “full anonymity—such as offered by cash—does not appear a viable option in my opinion.” She said anonymity “would contravene other public policy objectives such as ensuring compliance with anti-money laundering rules and combating the financing of terrorism.”
The European Central Bank hosted a “Civil Society Seminar” in January 2023 that discussed how CBDC development was going at the central bank. The questions from the public mostly revolved around privacy and cash.
In an October 2023 announcement, the European Central Bank repeatedly said that its CBDC (referred to as a digital euro) would be the “electronic equivalent to cash.” However, it's important to be clear that the CBDC would not be like cash at all. European Central Bank president Christine Lagarde has said in the past that, “When we surveyed Europeans, the first concern that they had… was privacy. Privacy is first and foremost on their mind when we divvy up the digital euro. [But] there would not be complete anonymity as there is with [cash.]”
On November 1, 2023, the European Central Bank initiated a two-year preparation phase to lay the groundwork for issuing a CBDC.
Although the European Central Bank has often pointed to declining cash use as a reason to launch a CBDC, it seems an anti-cryptocurrency motivation is also at play. In 2023, Lagarde said, “The reason I’m personally convinced that we have to move ahead [with a CBDC] is a situation like the one we are in now. … I don’t want Europe to be dependent on an unfriendly country’s currency… or dependent on a friendly currency [that] is activated by a private corporate entity like, you know, Facebook or Google. … I don’t want Meta, Google, or Amazon to suddenly come up with a currency that will take over the sovereignty of Europe.”
In 2024, the European Central Bank announced it was looking for developers to work on different components of what would become a digital euro. The European Central Bank offered a total budget of €1.1 billion ($1.2 billion) across the five different requests for applications. Of the topics covered, the European Central Bank is seeking developers that can work on risk and fraud management, app development, offline service, secure exchanges, and alias services.
European Central Bank executive board member Piero Cipollone told the European Parliament Committee on Economic and Monetary Affairs that the central bank was looking for CBDC developers even without authorizing legislation because “Our readiness would be compromised if we started searching for possible suppliers only after that decision [to launch a CBDC] is made.” He also noted there would be restrictions on CBDC holdings, restrictions on who may hold the CBDC, and no interest payments. Cipollone later suggested a CBDC could be rolled out as soon as November 2025.
In June 2024, the European Central Bank announced updates regarding CBDC progress, privacy, and participants. In terms of progress, the European Central Bank released a report outlining both the plan moving forward and current efforts. Namely, the report covers privacy, holding limits, account limits, offline use, standardization, government contractors, and more. The report also noted that any decision to move forward would not be made until the end of 2025. On privacy, specifically, European Central Bank data protection officer Maarten G.A. Daman wrote a blog titled, “Making the Digital Euro Truly Private.” However, the blog merely says that a digital euro could be private, but it’s up to legislators to decide how know-your-customer and anti-money laundering efforts will be handled. Finally, as far as participants go, the European Central Bank announced that its wholesale CBDC pilot would be expanded to involve 48 private firms and 3 central banks in an effort to test the use of distributed ledger technology. The pilot was scheduled to run from July to November 2024.
The European Central Bank hosted an event in September 2024 to discuss how to calibrate the holding limits on the digital euro.
In October 2024, the European Central Bank invited financial institutions to collaborate with the central bank. The main goals of this collaboration were to “demonstrate how ‘conditional payments’ could be implemented on a technical level,” “provide the opportunity for participants to interact with simulated digital euro interfaces,” and “explore additional use cases, ideas and visions that stakeholders may have for the digital euro.”
European Central Bank board member Piero Cipollone tried to explain how a digital euro would benefit the public in November 2024. He wrote that the digital euro would let people “pay digitally, seamlessly, anytime and anywhere.” However, he did not address how this universal acceptance would be achieved. Instead, he focused on describing instances in the current European market where someone might have “forgotten their wallet or don’t have enough cash.” Later in November, European Central Bank project manager Evelien Witlox made a similar appeal when she said, “If you look at the current landscape, we see a fragmentation of payment solutions, and the ones that come closest to covering the whole of Europe are non-European.”
At the same time, the European Central Bank invited “experts in branding and communication” to help decide what rules should apply to the use of the digital euro brand. For example, the European Central Bank hopes these experts can answer how the CBDC should be promoted by banks and other financial institutions.
In December 2024, the European Central Bank published its second progress report on the preparation of the digital euro. Most notably, the report revealed that work has “progressed on the design of a digital euro, specifically on (i) the calibration of the digital euro holding limit and (ii) the deployment of the offline digital euro solution on the secure elements of mobile devices.”
European Central Bank board member Piero Cipollone said the Eurozone needs a CBDC because of U.S. President Donald Trump in January 2025. More specifically, Cipollone took issue with President Trump for issuing an executive order to “promote the development and growth of lawful and legitimate dollar-backed stablecoins worldwide.” Somewhat ironically, Cipollone said stablecoins could disintermediate banks—a long-standing concern with CBDCs. Cipollone later added that he believes President Trump’s action would speed up support for the Eurozone to have a CBDC.
In February 2025, the European Central Bank announced that it “decided to expand its initiative to settle transactions recorded on distributed ledger technology (DLT) in central bank money.” In other words, the central bank decided to move forward with a wholesale CBDC. At the same time, the European Payment Study found that although most people knew the European Central Bank was considering a CBDC, only one in three respondents said that they would use the CBDC.
March 2025 proved to be a busy month for the European Central Bank on the CBDC front. Central bank president Christine Lagarde spoke about CBDCs at two events, board member Philip R. Lane gave a speech at another event, and the central bank published a paper on consumer attitudes towards a CBDC.
At her first March 2025 event, European Central Bank president Christine Lagarde provided an update on CBDC developments at a press conference. Lagarde caught considerable attention after saying, “The deadline for us is going to be October 2025 and we are getting ready for that deadline.” This statement was initially interpreted to mean that a CBDC would be launched in October 2025. However, Lagarde later clarified that the October deadline is the central bank’s deadline for its internal preparations. She acknowledged that the decision is ultimately one for legislators to make. Therefore, a CBDC could be launched in October at the soonest, but it may take longer.
At her second March 2025 event, European Central Bank president Christine Lagarde spoke before the Committee on Economic and Monetary Affairs in March 2025. Among the topics discussed, Lagarde argued for “pushing fast on the digital euro.” Emphasizing the point, she said, “My strong conviction is that we have to accelerate the digital euro both at wholesale and retail levels.” Speaking directly to lawmakers, she said, “I honestly count on you very much in order to expedite this matter and attach your priority attention to it. I'm saying that not in a vacuum because it's a tantrum, but because there is a serious series of changes happening in that sphere—whether it is the focus of the US administration on stablecoins, which are encouraged to develop massively, or whether it is the support for cryptocurrencies that suddenly find their way into this reserve account that has been set up.”
Elsewhere in March 2025, European Central Bank board member Philip R. Lane gave a speech in March 2025. Lane shared that “Draft legislation [for the digital euro] has been proposed by the European Commission and is currently under consideration by the Council of the European Union and the European Parliament.” Lane added that it is “imperative for the ECB to introduce a digital euro” because cash is used less and stablecoins are becoming more popular. Lane further said, “By mandating acceptance of the digital euro, we can create instant network effects that unify our fragmented market.”
Finally, the European Central Bank published a working paper in March 2025 that details consumer attitudes toward CBDCs. When told that a CBDC is a “digital form of cash, issued by the central bank and available to everyone,” 45% of respondents said they would adopt it.
In April 2025, the European Central Bank published a progress report on its digital euro rulebook. The rulebook is meant to “consist of a single set of rules, standards and procedures to standardise digital euro payments and related activities across the euro area.”
For additional information regarding metrics, the methodology page explains each of the data points and provides their respective sources.
