The digital euro is a proposed central bank digital currency (CBDC) for the euro area, developed by the European Central Bank (ECB) in partnership with eurozone national central banks and EU institutions. Envisioned as a digital form of central bank\footnote{test} money for retail use, the digital euro is intended to complement cash and existing electronic payments, ensuring\footnote{test} continued access to public money in the digital age. It is not meant to replace cash but to coexist with it.

1. Timeline and Key Milestones

• 2 October 2020: ECB publishes the first comprehensive report on a digital euro, officially launching the exploration phase.
• 12 October 2020 – 12 January 2021: Public consultation receives over 8,200 responses, with privacy as the top concern.
• 19 January 2021: ECB and European Commission agree to jointly examine design and regulatory requirements.
• 14 July 2021: Investigation phase begins; detailed studies into use cases, tech feasibility, and policy impact.
• 5 April – June 2022: Targeted consultation with experts on key issues such as design and distribution.
• September – December 2022: Prototyping with firms like Amazon, Worldline, CaixaBank, Nexi, and EPI.
• 7 November 2022: High-level ECB-Commission conference discusses legislative framework.
• 28 June 2023: EU Commission presents legislative proposals on digital euro and legal tender status of cash.
• 17 October 2023: EDPB and EDPS publish privacy opinion, advocating privacy thresholds.
• 18 October 2023: ECB begins preparation phase, aiming to finalize infrastructure and rules.
• 2024: Progress reports issued in June and December; legislation under discussion.
• October 2025 (Projected): End of preparation phase. Possible decision to launch the digital euro.
• 2026–2027: Potential issuance phase if all requirements are met and legal framework adopted.

2. Objectives of the Digital Euro

• Ensure public access to central bank money in a digital format.
• Preserve monetary sovereignty in a digital economy.
• Support financial inclusion and reduce dependence on non-European payment providers.
• Offer privacy-preserving digital payments.
• Complement existing cash and digital payment options.

3. Stakeholders and Entities Involved

• European Central Bank (ECB): Leads the initiative; responsible for strategy and decision-making.
• National Central Banks: Contribute to research and trials across all 20 eurozone countries.
• European Commission: Drafts legal framework and ensures regulatory readiness.
• Eurogroup & Council: Political stakeholders influencing legislation.
• European Parliament: Democratic oversight; must approve the legislation.
• EDPB & EDPS: Privacy watchdogs offering guidance on data protection.
• European Investment Bank: Experimentation with blockchain and digital bonds.
• BIS and Global Central Banks: Knowledge sharing and global CBDC interoperability.

4. Technology and Infrastructure

• Architecture: Likely a hybrid model combining centralized ledger with elements of DLT.
• TARGET Instant Payment Settlement (TIPS): Primary candidate for settlement infrastructure.
• Offline Capability: Tests conducted on peer-to-peer offline payments.
• Wallet System: Two-tier model with intermediaries (banks, PSPs) offering user-facing services.
• Privacy: Strong focus on data minimization; small payments may allow limited anonymity.

5. Industry Collaboration

• Prototypes tested by Amazon (e-commerce), Worldline (offline), CaixaBank (P2P online), Nexi and EPI (POS).
• Digital Euro Market Advisory Group: Includes banks, fintechs, and retailers.
• Euro Retail Payments Board: Consultation on user acceptance and merchant integration.
• Consumer groups (e.g., BEUC) and merchant associations (e.g., EuroCommerce) provided feedback.
• Academia involved in cryptography, security, and policy impact studies.

6. Legislative Framework

• Two proposed EU regulations (June 2023):
  • Digital Euro Regulation: Legal framework for issuance.
  • Cash Regulation: Safeguards continued acceptance of cash.
• The legislation aims to guarantee usability, accessibility, security, and privacy.
• Final law must be adopted by the European Parliament and Council.

7. Countries Involved All 20 eurozone countries participate via their central banks, including Germany, France, Italy, Spain, Netherlands, Ireland, Portugal, and Croatia. Non-euro EU states may participate indirectly via payment service providers.

Conclusion The digital euro represents one of the most ambitious monetary innovations in the EU’s history. While it aims to preserve cash’s role, it also positions Europe for a digitized financial future. The ECB is methodically progressing through design, testing, and legislation. A final decision on issuance may come by 2025, potentially paving the way for full deployment by 2026–2027, or later depending on political and technical readiness.\footnote{Treść, Koniec treści (2025). Rok [online] https://bitsky.pl}