The European Central Bank (ECB) needs a digital euro to ensure that Europeans retain access to central bank money in an increasingly digital economy, Executive Board member Piero Cipollone said in an interview released on 4 December. He warned that declining cash use risks undermining payment freedom because physical money cannot be used online.
Cipollone argued that Europe currently lacks a unified digital payment option issued within the euro area. Today, consumers often rely on non-European card schemes for daily purchases. He said this dependence raises concerns about resilience and strategic autonomy if a major external system were to malfunction.
Strategic and historical context
The ECB sees the digital euro as a modern extension of cash, allowing people to pay anywhere in the euro area with public money, both online and offline. Cipollone said this would restore what cash once provided, a universal means of payment backed by the central bank. He described the project as a natural evolution in the history of money, following cheques, cards, mobile payments and the potential rise of stablecoins.
Stablecoins, he noted, pose unique risks because their supply depends on collateral and may be vulnerable to runs. Euro-denominated stablecoins reduce some currency risks compared with dollar-based tokens, but they still face structural limitations. The ECB sees a public digital currency as essential to maintain monetary sovereignty, particularly as global technology firms expand their presence in payments.
Technical design and resilience
Cipollone said the ECB is building a resilient architecture with three independent sites operating in parallel to protect against outages and cyberattacks. Proposals from Baltic EU members, who face heightened security threats, have influenced the resilience strategy.
Offline payments would be available using secure hardware, although anti-money laundering procedures would continue to be performed by banks and payment service providers. The ECB would only see anonymised transaction codes, not user identities, reinforcing its message that it cannot track individual payments.
Holding limits would be introduced to protect financial stability by preventing large outflows from commercial banks. Cipollone said limits must be proportionate, and recent analysis indicates that a €3,000 ceiling would not pose systemic risks. Consumers would still be able to make larger payments by linking their digital euro wallet to their bank account.
Legislation, adoption and global cooperation
EU lawmakers are currently reviewing the digital euro regulation proposed in 2023. Cipollone said momentum is growing, with EU leaders describing the project as strategically important. He expects the legislation to be adopted in 2026, enabling technical work and pilots ahead of a potential issuance in 2029.
According to ECB surveys, 66 percent of people who understand the digital euro concept say they would be interested in using it. Tourists would also be able to make digital euro payments through European payment providers under the current legislative proposal.
Cipollone added that the ECB is prepared to share lessons and technology with other central banks, including the Bank of Japan, once the project advances. Europe is also collaborating on international payment improvements through BIS initiatives such as Project Agora.
Outlook
Asked about monetary policy, Cipollone reiterated that the ECB’s rate decisions remain data-dependent. Inflation projections appear more balanced, but risks remain, including potential shifts in global trade and consumption patterns.
For now, the institution remains focused on building what Cipollone calls a strategic tool for Europe’s future resilience. A digital euro, he said, would ensure that central bank money continues to anchor the financial system in an era defined by digital payments and geopolitical uncertainty.