A public digital currency is on its way, but it may take at least two years before a digital euro potentially hits the market, according to European Central Bank president Christine Lagarde.
The European Central Bank will decide in October whether it will move forward with the realisation of a digital euro. The central bank has developed a prototype over the past two years.
s the final say by the Governing Council, he told lawmakers in the European Parliament in a quarter-final catch-up.
The digital euro has received a thorny reception from the public and lawmakers, as a result of its scepticism and disapproval.
If the European authorities can address all the conspiracy theories that abound about this as if Big Brother was going to suddenly determine what you buy, when you buy it, and how restricted it should be, then I think it would be characterised as a success, he said.
The European Commission has already laid out the legal framework for central bank digital currencies. The proposal was published in May, and is now in parliament's desks where parliamentarians will debate and alter the Commission's text.
Germany's right-wing politician Stefan Berger, a left-wing member of parliament, will lead the talks. He was the lead negotiator for the EU's landmark regime for crypto assets, which will be implemented across the bloc.
However, central bank officials have said that the push does not guarantee the digital euro will become a reality.
Despite Europe's monetary sovereignty, European officials are determined to compete with private and foreign financial institutions, such as PayPal or Visa.
In the present era, the digital euro is intended to have an offline payment option for peer-to-peer transactions. This would provide users with the same level of privacy as taking cash out of an ATM.
While the CBDC would be issued by the central bank, the ECB has said it will not have any access to user data. But private banking applications would host the CBDC wallet and provide the same level of privacy they typically have.
The new digital euro will have a holding limit of around 3,000, officials said. German legislator Nicola Beer said a 'holding limit, identification, and total traceability' would hinder the acceptance of the digital euro.