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Digital Euro Passes Key EU Vote, Sets Stage for 2029 Rollout
EU committee OK'd digital euro rules 43-14. CBDC targets 2029 launch with offline payments, no interest, holding limits. Upside risk to euro stablecoins.
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The European Parliament's Economic and Monetary Affairs Committee approved the digital euro proposal on a 43-14 vote Tuesday. Lawmakers backed rules that would govern the future central bank digital currency across the eurozone. The decision moves the project closer to a potential launch in 2029. For crypto traders, the vote signals that a state-backed euro token is real. That timeline puts it squarely in competition with private stablecoins, both euro-denominated and dollar-based.
Fernando Navarrete Rojas, the lead lawmaker on the file, said the package "protects citizens' freedom to choose how they pay." He added that the digital euro would "complement cash, never replace it." The proposal assigns issuance to the European Central Bank. It allows both online and offline payments. Online transactions would use an account-based structure. Offline payments would rely on local device storage and offer cash-like functionality. The approved text states that losing a device would also mean losing offline funds.
The privacy measures are specific. According to the committee announcement, "The ECB would not have access to personal identification data." The text supports zero-knowledge proofs for verification. Lawmakers also included holding limits for individuals. The European Commission would set those limits after receiving ECB recommendations, and authorities would review the thresholds regularly.
The digital euro would not pay interest. Businesses could hold digital euros temporarily while collecting incoming payments, generally capped at 24 hours. Most businesses would need to accept the digital euro once launched. Exemptions apply to very small firms and some self-employed operators that do not already accept digital payments.
Basic services would remain free. Account access and payment functions would carry no charges. Offline transactions would also stay free. Distribution would go through banks and payment providers. Regulated crypto firms could also participate. Post offices and e-money providers could support access across the eurozone.
The ECB must complete technical standards and pilot programs before launch. The institution must coordinate implementation with payment providers. After final approval, rollout would take at least two years.