The European Central Bank is technically ready to implement the digital euro. What it now needs is political action. With inflation returning close to the 2% target, the ECB is increasingly positioning the digital euro as a strategic financial tool.

“We have done our work,” ECB President Christine Lagarde said at a recent press conference.

ECB waits for political approval

Lagarde confirmed that the ECB has completed its technical and preparatory work and that responsibility now lies with European political institutions. The proposal for the digital euro is currently under review by the European Council and the European Parliament.

The European Council has already expressed its support for the project. The next step therefore lies with the Parliament.

“We have done our work, we have carried the water, but it's now for the European Council and certainly later on for the European Parliament to identify whether the Commission proposal is satisfactory, how it can be transformed into a piece of legislation or amended,” Lagarde said shortly before Christmas.

The project aims to establish a public digital means of payment — a digital form of central bank money that would complement physical cash and safeguard monetary sovereignty in the digital age.

Inflation no longer the main priority

Price stability remains the ECB’s primary mandate. However, with inflation largely back on target, the central bank can now focus on longer-term structural priorities.

Lagarde noted that inflation is expected to stay close to the ECB’s 2% target by 2028, even though it may temporarily fall slightly below that level in 2026 and 2027. As a result, inflation is no longer seen as the eurozone’s most pressing challenge.

“Our ambition is not to be role models,” Lagarde said. “Our ambition is to make sure that in the digital age, there is a currency that is the anchor of stability for the financial system.”

She emphasized that central bank money already plays this role in physical form — banknotes — but that a digital expression of this sovereignty is increasingly necessary.

ECB Executive Board member Piero Cipollone added that a digital euro could help ensure payment continuity during cyberattacks or power outages affecting traditional banking infrastructure.

The digital euro was initially expected to launch in the second half of 2026, broadly aligning with euro-backed stablecoins regulated under the EU’s Markets in Crypto-Assets (MiCA) framework.

Earlier this month, however, the ECB updated its timeline. It now plans to prepare for a potential issuance by 2029, assuming EU lawmakers adopt the necessary regulation by 2026. Pilot projects and initial transactions could begin as early as mid-2027.

Sources:

https://www.coindesk.com/policy/2025/12/18/ecb-s-christine-lagarde-shifts-focus-to-digital-euro-rollout-after-holding-rates

https://www.ecb.europa.eu/press/press_conference/monetary-policy-statement/2025/html/ecb.is251218~3a10402adb.en.html

https://www.ecb.europa.eu/press/blog/date/2025/html/ecb.blog20251209~9ba130ff20.en.html