The European Central Bank has renewed its push for the digital euro, with President Christine Lagarde urging EU lawmakers to move quickly on legislation and framing the project as essential for financial stability and monetary sovereignty in the digital age.
Speaking at the ECB’s monetary policy press conference on 18 December, Lagarde said central bank money must have a digital expression to remain the “anchor of stability” for Europe’s financial system. She explicitly called for the rapid adoption of the proposed digital euro regulation by the Council and the European Parliament.
The comments came as the ECB Governing Council kept interest rates unchanged and confirmed that inflation is on track to stabilise at its 2 percent target over the medium term. While monetary policy decisions dominated the meeting, Lagarde used the press conference to underline the strategic importance of the digital euro beyond short-term economic conditions.
Digital euro as public money in a digital age
Lagarde argued that physical cash alone can no longer fulfil the role of central bank money in an increasingly digital economy. “In the digital age, it has to be a digital expression of that sovereignty and a digital anchor for the purpose of the financial system that we have,” she said.
She stressed that the ECB’s goal is not to become a global role model for central bank digital currencies, but to ensure Europeans continue to have access to risk-free public money as payments move online. The digital euro, she said, would complement cash and preserve the role of central bank money as the foundation of trust in the financial system.
Lagarde highlighted core design goals that the ECB has repeatedly emphasised, including privacy, low cost, speed, and the ability to function both online and offline. She added that the ECB and its Executive Board strongly support the initiative and place “great hopes” in the legislative work ahead.
Pressure on lawmakers to deliver legislation
The ECB president made clear that the project has reached a political phase. Technical preparation by the Eurosystem is largely complete, she said, and responsibility now lies with EU institutions to decide whether the European Commission’s proposal is adopted or amended.
The Governing Council also echoed this message in its monetary policy statement, calling for the rapid adoption of the regulation establishing the digital euro as part of broader efforts to strengthen Europe’s economy, capital markets and strategic autonomy.
The renewed urgency reflects growing concern within the ECB about Europe’s dependence on non-European payment providers and the risk that private digital money could weaken monetary sovereignty if public alternatives are not available.
Stablecoins, MiCAR and monetary sovereignty
Lagarde also addressed the role of stablecoins, drawing a clear distinction between regulated and unregulated digital money. She said Europe is “lucky” to have the Markets in Crypto-Assets Regulation, which provides a framework for supervising stablecoins and ensuring one-to-one backing for users.
Stablecoins that comply with MiCAR can function as alternative payment instruments, she said, without requiring the ECB to take a policy position. However, Lagarde warned about the risks of multi-currency stablecoin issuance, which could expose European safeguards to pressures from other jurisdictions and undermine the protections built into MiCAR.
These remarks reinforced the ECB’s long-standing view that private digital money cannot replace central bank money as the ultimate settlement asset, especially in times of stress.
A strategic pillar alongside monetary policy
Although the ECB’s main decision was to keep interest rates unchanged, the digital euro emerged as a strategic theme linking monetary policy, financial stability and Europe’s long-term autonomy.
By tying the digital euro directly to the stability of the financial system, Lagarde elevated the project from a payments innovation to a core element of Europe’s monetary architecture. With legislative discussions expected to intensify in 2026, the ECB has made clear it sees delay as a growing risk.