ECB officials move to a ‘preparatory phase’ for the digital euro

The Governing Council of the European Central Bank (ECB) has announced the start of a “preparatory phase” for the digital euro project following a two-year investigation.

In an announcement on October 18, the ECB It stated that it plans to “start laying the groundwork for a digital euro rollout” starting November 1, a central bank digital currency (CBCC) is not a foregone conclusion. The announcement follows the release of a 44-page report on the design and deployment of the digital euro.

The preparatory phase, according to the ECB, will last two years and will focus on finalizing regulations for the digital currency as well as selecting issuers. Officials say the next step will include “testing and testing” based on user feedback and the Central Bank's requirements.

“After two years, the Governing Council will decide to move to the next stage of preparation, to develop a path for the issuance and release of the digital euro that can be issued in the future,” the ECB said. “The start of the preparatory phase is not a decision to issue a digital euro. The decision will only be taken by the Governing Council after the completion of the EU legislative process.

Our Governing Council has decided to move to the next phase of the Digital Euro project.

In November 2023, we will start laying the foundation for the issuance of the digital euro. The decision to issue a digital euro will come later. pic.twitter.com/Nn0Z8RggVn

— European Central Bank (@ecb) October 18, 2023

Related: EU finance chief: Don't rush digital euro ahead of new commission in June 2024

In June, the European Commission proposed a legislative plan for the digital euro, with the aim of allowing users to access CBDC through their banks. Fabio Panetta, a member of the ECB's executive board, reiterated his goal to have a digital euro with many of the same privacy features as cash.

Many in the crypto space have criticized ECB President Christine Lagarde for a prank video in which she claimed to have spoken to Ukrainian President Volodymyr Zelensky, suggesting that the digital euro could be used to control user payments. The rollout of any digital euro has attracted the attention of regulators and policymakers, who will vote for the European Parliament in June 2024.

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