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The European Central Bank (ECB) has said that it is ready to launch a digital euro. Now, it is up to EU lawmakers to determine what to do with this ambitious central bank digital currency (CBDC). Christine Lagarde, the president of the European Central Bank (ECB), said at a press conference on December 18, 2025, that the bank’s internal work was done.
She said that the bank had “carried the water” and was now waiting for the European Council and Parliament to turn the plan into law. This news comes at a time when there are global races for CBDCs and stablecoins are rising, making the digital euro a possible anchor for monetary sovereignty in a world where payments are becoming more and more digital. If the law passes in 2026, the initiative might change the way 340 million eurozone citizens pay for things by mixing cash-like anonymity with blockchain speed. It could be released as early as 2029.
ECB Finishes Getting Ready
During the last press conference of the year for the ECB’s monetary policy, Lagarde spoke. Rates stayed the same. She stressed, “We have done our work,” pointing out that the technical and operational bases are ready when the preparation phase ends in October 2025. This phase, which started in November 2023, improved the rulebook, chose suppliers, and tested features including offline functionality and conditional payments.
A draft scheme rulebook that makes payments the same across the euro area, innovation platforms involving market players, and user research that focuses on making things easier for merchants and vulnerable groups are some of the most important things that have been done. The ECB also made privacy features better: Online payments are safer than digital payments that are already available. Offline payments, on the other hand, are like cash in that only the payer and payee know their personal information.
The conclusion report for the preparatory phase, which came out on October 29, 2025, focused on stakeholder interaction and technical studies of banking costs and holding limitations. If the law moves forward, the ECB will be ready for pilots in the middle of 2027, with complete preparedness by 2029.
Political Momentum and Legislative Hurdles
Even while the technology is ready, the future of the digital euro depends on politics. The Council and Parliament must approve the European Commission’s 2023 plan. The Council agreed on a negotiating stance on December 19, 2025, which included both online and offline versions. This was different from Parliament’s earlier concentration on offline-only versions.
This order includes limitations on holding (determined by the ECB and capped every two years) to stop banks from disintermediating, limits on transitional fees, and protections for privacy. At summits in October, politicians from the euro area pushed for quick progress, saying that the digital euro was important for sovereignty because the USD stablecoin is so strong ($295 billion cap).
“It’s up to the Council and Parliament to decide if the proposal is good enough,” Lagarde told MPs. The Danish Council Presidency wants everyone to agree by the end of 2025, but there are still disagreements on privacy, inclusivity, and cash complementarity. The ECON Committee of Parliament, which was briefed on November 18, wants strong protections for consumers.
Goals and Design Elements
The digital euro, a retail CBDC, would be legal tender along with cash and would be issued directly by the ECB with full backing. Goals include keeping central bank money’s role in digital payments, making the system more resistant to hacks and outages, and encouraging competition in a market where Visa/Mastercard and Big Tech are the main players.
Design puts a lot of emphasis on privacy. For example, payments made in person are like cash, whereas payments made online have tiered disclosure (basic for low-value transactions and full for high-risk transactions under AML). It allows conditional payments, such automatic refunds, and is open to everyone, even those without bank accounts. It’s safe, unlike private stablecoins, and it can yield income while avoiding disintermediation through holding caps.
It fights China’s e-CNY (1.8 trillion yuan processed) and U.S. dollar stablecoins on a global scale, making the euro stronger in the face of $150 trillion in cross-border transactions.
Problems and Comparisons Around the World
Privacy is still a hot topic: supporters appreciate cash-like offline modes, but critics worry about monitoring creep even though the ECB doesn’t have access to personal data and intermediaries handle AML. Inclusion efforts focus on those that are at risk, but there are problems with the digital divide in rural areas.
There are several comparisons: Brazil’s Drex is a real-denominated CBDC, and Vietnam’s NDAChain focuses on tokenized assets. The Bahamas’ Sand Dollar and Nigeria’s eNaira show how hard it can be to get people to use new things. Europe’s strategy, which is focused on retail and privacy, is different from wholesale pilots like the Fed’s possible explorations.
Conclusion
The ECB’s announcement that it is ready for the digital euro—technical preparations are done, and issuance is planned for 2029 pending legislation in 2026—marks a turning point in Europe’s CBDC journey. Lagarde’s handover to politicians shows the change from engineering to politics, which is about finding the right balance between privacy, sovereignty, and inclusiveness. The digital euro might help keep things stable for 340 million people as stablecoins handle trillions of dollars and cash use goes down. With the Council’s support and the Parliament’s debates coming up, 2026 will decide: A digital cash complement or a dream that will come true later? For people who watch cryptocurrencies, it shows how CBDCs move slowly compared to stablecoins, which are quick to respond. This is Europe’s bet on public money in a world dominated by private money.
