Digital euro technical specifications to be finalized by summer, ECB's Cipollone announces
Piero Cipollone from the European Central Bank announced that crucial technical specifications for the digital euro should be established by summer, enabling financial institutions and retailers to begin preparations for its implementation.
Piero Cipollone, a member of the European Central Bank's Executive Board, announced on Tuesday that the institution anticipates revealing the European technical standards for a prospective digital euro by the summer months. This announcement represents a strategic move designed to assist payment service providers and retail merchants in preparing their infrastructure in advance of any final decision regarding the currency's launch.
During his address to lawmakers from the European Union, Cipollone explained that following the release of these technical standards, the ECB intends to collaborate closely with industry stakeholders to enable them to start integrating these specifications into their payment terminal systems and various other technological solutions at the earliest opportunity.
According to Cipollone, completing this comprehensive rulebook would enable newly manufactured payment terminals and digital payment applications to come pre-equipped with the required infrastructure already integrated, providing European businesses with a competitive advantage once the necessary legislation from the EU is enacted, which the ECB anticipates will occur in 2026.
The pilot program for the ECB's digital euro initiative, for which the central bank issued an invitation to licensed payment service providers during the month of March, is scheduled to operate over a 12-month period beginning in the latter half of 2027, Cipollone stated. The pilot will focus on testing peer-to-peer transactions and retail point-of-sale payments within a restricted testing environment, forming part of broader preparations to achieve technical readiness for a potential launch approximately in 2029, contingent upon legislative approval of the necessary legal framework by policymakers.
ECB says costs should be weighed
Previous analytical work conducted by the ECB projected that implementing a digital euro could generate costs for European Union banking institutions in the range of 4-6 billion euros across a four-year timeframe, a figure the central bank characterized as approximately 3% of their yearly information technology maintenance expenditures, according to a Reuters report from February. Cipollone informed legislators that these implementation costs need to be balanced against the extended-term advantages of retaining higher portions of merchant transaction fees and expanding European payment infrastructure networks.
Cipollone emphasized once again that the digital euro is designed as public payment infrastructure that would be utilized by private sector intermediaries, including banking institutions and payment service companies, to deliver digital wallet solutions and related services to consumers, as opposed to being a product offered directly to the public by the ECB.
He explained that the objective is to establish pan-European payment infrastructure that decreases reliance on global card network operators, with co-branded cards and banking wallet applications capable of seamlessly transitioning between national payment schemes and the digital euro throughout the entire euro area region.
Cipollone stated that the digital euro is intended to serve as a complement to physical cash and traditional bank deposit accounts rather than functioning as a substitute for them, and emphasized that inclusive accessibility features, including voice-activated commands and enlarged-font display options, are being incorporated into the reference application design from the initial stages to guarantee universal accessibility.
He further stated that the ECB seeks to maintain central bank money as the foundational "anchor" for future wholesale financial markets, referencing the institution's Pontes initiative, which conducts testing on settling tokenized securities using central bank money across various distributed ledger technology platforms, along with its Appia strategic framework for establishing a tokenized European financial infrastructure.
In another presentation delivered on Monday, he detailed how tokenized central bank money could function as the settlement instrument for stablecoins and tokenized deposit products.