- The ECB has completed all technical and preparatory work for the digital euro, with President Christine Lagarde confirming that issuance now depends on the European Parliament and Council passing the necessary legislation in 2026.
- While rates were left unchanged and inflation is projected to return to the 2% target by 2028, Lagarde stressed the digital euro as a strategic priority to anchor financial stability in the digital age.
- Its development faces a shifting global landscape marked by the U.S. GENIUS Act supporting dollar stablecoins and President Trump’s active opposition to CBDCs.
At the ECB’s final press conference of the year, President Christine Lagarde said the bank has finished its technical and preparatory work.
The next step sits with EU institutions reviewing the plan, including the European Council and the European Parliament, which would need to turn the Commission’s proposal into legislation. Lagarde said the ECB has done what it can and is waiting for lawmakers to decide how the proposal should be adopted or amended.
While talking about inflation potentially returning to the ECB’s 2% target by 2028, they are not “pre-committing to a particular rate path.”
Our ambition is to make sure that in the digital age there is a currency that is the anchor of stability for the financial system.
Christine Lagarde, President of the ECB. Read more: Visa Brings USDC Settlement Onshore, Accelerating Stablecoins in U.S. Payments
What’s the Digital Euro About?
The digital euro is being designed as a retail central bank digital currency (CBDC), so basically a public form of money issued by the central bank, with legal tender status like cash.
The stated goals include strengthening Europe’s payments infrastructure, supporting financial stability and monetary sovereignty, and improving access and usability for the public. The proposal also argues it could offer a high level of privacy in digital payments.
ECB officials have framed it as a way to keep central bank money available in a payments system that is increasingly digital. Lagarde said the aim is for a public currency to remain the “anchor of stability” for the financial system in the digital age.
It was also reported that a consortium of 10 leading EU banks plans to launch a Euro-pegged stablecoin in the latter half of 2026 (MiCA-compliant, of course) through a new entity authorised by the Dutch Central Bank.
A Shifting Debate
The debate has also been influenced by shifts in US crypto policy. For instance, the managing director of the European Stability Mechanism (ESM) urged the EU to move faster as the US developed a stablecoin policy aimed at reinforcing the dollar (the GENIUS Act), and he argued that politicians were becoming more alert to the issue.
At the same time, Trump has opposed central bank digital currencies, arguing they could give governments too much control over personal finances.
He signed an executive order in January barring federal agencies from establishing, issuing, or promoting a CBDC, effectively pausing US CBDC efforts under his administration.
Related: Crypto Left Out of Trump’s National Security Strategy Despite His Public Focus on It
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