On December 19, 2025, the Council of the European Union finalized its negotiating stance on the digital euro, moving the proposed Central Bank Digital Currency (CBDC) closer to reality. This official position establishes that the European Central Bank (ECB) will issue the currency for use in both online and offline transactions across the eurozone. This decision expands upon previous legislative ideas that focused primarily on offline functionality, setting the stage for formal talks between EU institutions.
Core Functionalities: Online vs. Offline
The Council’s mandate outlines two distinct ways the digital euro will operate:
- Online Payments: These transactions will settle via the ECB ledger or through authorized financial intermediaries. This mode is designed for e-commerce and remote services, integrating the digital euro into the broader digital economy.
- Offline Payments: Functioning similarly to physical cash, these transactions will be processed directly between devices (like phones or smart cards) without an active internet connection. Data is stored locally and synchronized later, offering a high level of privacy and resilience during network outages.
Regulation and User Experience
To balance innovation with financial stability, the Council has proposed several key guardrails:
- Holding Limits: The ECB will set and periodically review caps on how much digital currency an individual can hold. This is intended to prevent a massive migration of funds away from traditional commercial banks.
- Fee Structures: Basic services must be provided to citizens free of charge. While payment providers can charge for premium services, these fees will be regulated to stay in line with current card and bank account costs.
- Privacy: Offline transactions will maintain a "cash-like" privacy model, ensuring that small-value payment details remain on the user's device rather than a central server, provided they stay within legal thresholds.
Future Outlook and Implementation
The ECB has already moved into a technical building phase as of October 2025. While the legal framework is still being refined by the Council and European Parliament, the current roadmap includes:
- 2027: Launch of official pilot programs.
- 2029: Targeted date for the first official issuance.
While commercial banks will handle the distribution and customer service aspects, the introduction of the digital euro is expected to challenge existing payment providers. By offering capped fees and universal merchant acceptance, the digital euro could disrupt the current dominance of high-fee card schemes and private digital wallets.
December 2025, Cryptoniteuae