Digital euro 2029 target at risk without swift legislative action, ECB cautions

Digital euro 2029 target at risk without swift legislative action, ECB cautions

Piero Cipollone from the ECB's Executive Board cautioned European Union legislators that failure to expedite digital euro legislation could result in postponement of the anticipated 2029 launch date.

Piero Cipollone, a member of the European Central Bank (ECB) Executive Board, urged negotiators from the European Union to finalize an agreement on legislation governing the digital euro before the year concludes in order to maintain the feasibility of a 2029 launch date.

During his address to the European Parliament's Committee on Economic and Monetary Affairs this Tuesday, Cipollone emphasized that passing this regulation, which forms a component of the EU's Single Currency Package, would provide the ECB with the necessary legal framework to finalize its preparatory work.

A delay in adoption could instead postpone the introduction of the digital euro

Piero Cipollone, ECB Executive Board member

Cipollone cautioned that pushing back the launch timeline could intensify Europe's reliance on payment service providers from outside the region and create additional obstacles for European businesses seeking to maintain competitive positions.

The ECB's objective is to achieve readiness for a possible initial issuance in 2029, contingent upon the EU's adoption of the regulation during the current year. Following the passage of this legislation, the ECB's Governing Council will make a determination regarding whether to proceed with issuing the digital euro and establish the timing for such issuance.

In June, the European Parliament's economic affairs committee gave approval to its stance on the digital euro legislation through a vote of 43 to 14. The Parliament subsequently adopted its negotiating position in July, which opened the door for discussions with member states of the EU.

The ECB has plans for a 12-month pilot program scheduled to commence during the second half of 2027. During this testing phase, payment providers along with selected merchants will evaluate a beta version of the digital euro.

This warning arrives at a time when the ECB is preparing for a transition in leadership. In October, President Christine Lagarde made an announcement regarding her intention to step down on Feb. 7, 2027, which falls before the planned pilot program.