The European Central Bank (ECB) is actively advancing the rule-setting process for a digital euro, particularly in the realm of payment infrastructure. Recently, the ECB initiated a recruitment drive to attract specialists who will participate in drafting rulebooks for crucial components such as automated teller machines (ATMs) and in-store payment terminals.
This initiative will meticulously define how various payment devices handle digital euro transactions, focusing on connectivity issues between devices and support for offline payment capabilities. ECB President Christine Lagarde previously stated that the technical and preparatory phases are complete, with subsequent steps to be determined by political bodies.
Currently, the European Council and the European Parliament are deliberating on the digital euro project. Once the legislative process is approved, the ECB's Governing Council can make the decision to issue a digital euro. The ECB has hinted that a potential launch could occur around 2029.
Another workstream will concentrate on defining how point-of-sale (POS) systems process transactions, including establishing rules for secure connections and data handling, while ensuring compatibility with existing bank card networks. Additionally, a separate team will be responsible for designing a certification framework, outlining testing and approval standards to ensure payment service providers obtain necessary accreditation before offering digital euro payment services.
The ECB noted that certification will cover payment instruments and related infrastructure, clarifying how businesses will validate the systems they use in stores and online. The objective is to ensure the digital euro is accepted under uniform standards across all member states.
Concurrently, the European Banking Federation is advancing its Qivalis euro-pegged token initiative. The federation plans to offer blockchain-based, euro-linked payment services to mitigate reliance on dollar stablecoins and provide settlement options for digital transactions across Europe. The Qivalis project emphasizes private sector innovation, with participating banks committed to building infrastructure that supports distributed ledger technology, aiming to expand euro-denominated payment instruments in the digital market.
As lawmakers debate the digital euro proposal, the ECB continues its preparatory work. Although no final launch date has been set, the ECB is poised to act swiftly once legislation is passed. Lagarde reiterated that political approval is a prerequisite for issuing the digital euro, and the ECB's Governing Council will only proceed after legislative clarity, continuing technical planning throughout the deliberation period.