The European Parliament has advanced legislation for a digital euro, bringing the EU closer to launching a central bank digital currency, while the U.S. moves to restrict similar efforts.
Summary
- EU lawmakers backed digital euro legislation, moving the ECB closer to a potential 2029 launch.
- The ECB says the digital euro would complement cash and reduce reliance on foreign payment networks.
- Meanwhile, the U.S. Senate approved a bill that would block the Federal Reserve from issuing a CBDC until 2030.
According to a June 23 decision by the European Parliament’s Economic and Monetary Affairs Committee, lawmakers backed the proposed framework for a digital euro, a key step in the legislative process that could pave the way for a launch by 2029.
The vote arrives as European policymakers examine the region’s dependence on foreign payment infrastructure. Data cited by the European Central Bank shows that Visa and Mastercard handle 61% of card payments in the euro area and nearly 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 ECB. Under the proposal, consumers would hold digital euros in dedicated wallets, while banks and payment providers would offer services connected to the system.
The digital euro remains under development
Within the proposed framework, the ECB would operate the core infrastructure while financial institutions would manage customer-facing services. According to the proposal, the system could support both online and offline payments and include privacy safeguards for users.
Holding limits for digital euro wallets have not yet been finalized and remain part of ongoing negotiations among European institutions.
European authorities have repeatedly stated that the digital euro is intended to complement physical cash rather than replace it. Following the committee vote, the ECB welcomed the outcome, stating that the European Parliament’s position supports both the preservation of euro cash as legal tender and the development of a digital version of the currency.
Although the ECB has warned that stablecoins could create risks for 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. As reported by crypto.news, Bank of Korea Governor Shin Hyun-song said in his inaugural speech in April that the central bank would support innovation in blockchain-based finance while maintaining the stability of South Korea’s payment and settlement systems. He added that the bank would work to strengthen the role of the Korean won in an increasingly digital financial environment.
U.S. lawmakers take the opposite route
While Europe advances work on a central bank-issued digital currency, policymakers in the U.S. are pursuing a different approach.
The U.S. Senate recently approved the 21st Century ROAD to Housing Act in an 85-5 vote. Included in the legislation is a provision that would prevent the Federal Reserve from creating a CBDC or a 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.
At the same time, U.S. lawmakers continue to work on crypto-specific legislation. The CLARITY Act, which seeks to establish a clearer regulatory framework for digital assets, remains under consideration as Congress debates the future structure of the country’s crypto market.
