The European Parliament has introduced legislation for a digital euro, bringing the EU closer to launching a central bank digital currency, while the United States moves to restrict similar efforts.
summary
- EU lawmakers backed legislation for a digital euro, bringing the European Central Bank closer to a potential launch in 2029.
- The ECB says a digital euro will complement cash and reduce reliance on foreign payment networks.
- Meanwhile, the US Senate has approved a bill that would prevent the Federal Reserve from issuing a central bank digital currency until 2030.
According to June 23 resolution By the European Parliament’s Economic and Monetary Affairs Committee, lawmakers endorsed the proposed framework for a digital euro, a key step in the legislative process that could pave the way for its launch by 2029.
The vote comes as European policymakers examine the extent of the region’s reliance on foreign payments infrastructure. Data cited by the European Central Bank show that Visa and Mastercard handle 61% of card payments in the eurozone and almost all cross-border card transactions.
European officials have argued that a digital euro could strengthen the bloc’s payment system by providing a public digital payment option issued directly by the European Central Bank. Under the proposal, consumers would hold the digital euro in dedicated wallets, while banks and payment service providers would offer services connected to the system.
The digital euro is still under development
Under the proposed framework, the European Central Bank would operate core infrastructure while financial institutions would manage customer-facing services. According to the proposal, the system could support online and offline payments and include privacy guarantees for users.
The holding limits for digital Euro wallets have not yet been finalized and remain part of ongoing negotiations between European institutions.
European authorities have repeatedly stated that the digital euro is intended to complement physical cash, not replace it. After the committee vote, the European Central Bank welcomed the result, noting that the European Parliament’s position supports maintaining the euro as legal tender and developing a digital version of the currency.
Although the European Central Bank has done so to caution Since stablecoins can create risks to the financial system, the central bank has continued to support the digital euro project as part of its long-term payments strategy.
Elsewhere in Asia, central banks are also exploring digital finance initiatives. like I mentioned By crypto.news Bank of Korea Governor Shin Hyun-sung said in his inaugural speech in April that the central bank will support innovation in blockchain-based finance while maintaining the stability of South Korea’s payment and settlement systems. He added that the bank will work to enhance the role of the Korean won in an increasingly digital financial environment.
American lawmakers are taking the opposite route
While Europe is moving ahead with work on a central bank-issued digital currency, policymakers in the United States are taking a different approach.
US Senate recently consent The 21st Century Road to Housing Act passed by a vote of 85 to 5. The legislation includes a provision that would prevent the Federal Reserve from creating a central bank digital currency or similar asset before the end of 2030.
The Senate’s position aligns with President Donald Trump’s support for privately issued stablecoins rather than a Federal Reserve-backed digital currency.
Meanwhile, US lawmakers continue to work on cryptocurrency legislation. The CLARITY Act, which seeks to create a clearer regulatory framework for digital assets, is still under consideration as Congress debates the future structure of the country’s cryptocurrency market.
