The European Central Bank (ECB) updated its rulebook for the use of the digital euro (CBDC) based on consultations with market participants and is continuing preparations for its launch.
The ECB published a second progress report on preparations for the launch of the European Central Bank’s digital currency. Among other things, the bank’s representatives completed the application process for external service providers associated with the digital euro and launched a tender for participation in the practical implementation of the European CBDC.
ECB reps consulted with consumers, retailers, and payment service providers to refine the rules governing the use of the digital euro. The press release notes that this stage laid the groundwork for the possible issuance of the CBDC and for harmonizing digital payments across the Eurozone in the future.
Additionally, new research on user preferences regarding digital assets was launched. In particular, the authors were interested in the experiences of small businesses and vulnerable population groups. The project also plans to explore innovative use cases for the digital euro and test automated payments in cooperation with merchants, FinTech companies, payment service providers, and research organizations.
Parallel efforts will continue with institutions within the European System of Central Banks. Specifically, a methodology for setting limits on digital euro holdings will be developed, taking into account user experience, monetary policy, and risks to financial stability.
The new phase of digital euro research is expected to last until next year. A decision on whether to proceed to the next stage of preparations for the implementation of the European CBDC won’t be made before late 2025.
The development of standards and regulatory frameworks for the digital euro are underway for two years. At the very beginning of 2024, the ECB reported progress in this area. Then, in mid-2024, the European Central Bank published a report addressing privacy issues related to the future European CBDC, which caused the greatest concern among potential users.
