DIGITAL LIFE

Digital Euro gains new momentum with agreement among European ministers

According to Valdis Dombrovskis, European Commissioner for Economic Affairs, the agreement "gives new impetus to efforts to reach a common position" on the digital euro in the Council of Ministers by the end of the year.

Today, the Eurogroup's finance ministers reached an agreement on the framework for the creation of the digital euro. Speaking during the press conference following the Eurogroup meeting, Valdis Dombrovskis, European Commissioner for Economic Affairs, emphasized that, "in light of recent economic developments," it is becoming increasingly important "to discuss ways to strengthen the role of the euro as an international and digital currency."

"While we have seen slow but steady progress over the past two years, there is now a greater sense of urgency to reach a political agreement and resolve the remaining outstanding issues," the Commissioner emphasized.

In the words of Valdis Dombrovskis, during this meeting, it was possible to reach "significant progress" regarding the institutional framework for "setting the maximum limit and holding limits, ensuring an appropriate role for both the Council and the European Central Bank (ECB)," although without providing many more details about these limits.

"This agreement gives new impetus to efforts to reach a common position in the Council by the end of the year," stated the European Commissioner.

"The compromise we reached was that, before the ECB takes a final decision on the issuance [of the digital euro] (...) there would be an opportunity for a discussion in the Council of Ministers," said Paschal Donohoe, president of the Eurogroup, as quoted by Reuters.

During the same press conference, Christine Lagarde, president of the ECB, argued that "the digital euro is not just a means of payment, it is also a political statement about Europe's sovereignty and its ability to manage payments, including cross-border payments, with a European infrastructure and solution."

As the news agency notes, the European Commission presented a legislative proposal for the Digital Euro in 2023. However, this proposal has not yet been approved by the European Parliament and the Council of the European Union.

The ECB expects the legislation to be ready to enter into force by June, although it would still take between two and a half and three years to launch the digital euro.

It should be noted that back in May, the ECB created a platform to simulate payments with the digital euro, such as receiving an order for an online purchase.

The initiative has the participation of 70 entities, including merchants, companies that provide financial products and services, startups, banks, and other payment service providers.

Participants joined one or both of the "Pioneers" and "Visionaries" working groups, each with specific objectives. The conclusions of the working groups will be published in a report later this year.

Back in June, the ECB argued that cryptocurrencies could reduce the international use of the euro, highlighting the importance of launching the digital euro.

mundophone