digital euro

European policymakers took a step toward the launch of a digital euro today with the European Commission’s release of a set of legislative proposals to establish a framework for a central bank issued digital currency.

According to the commission, the proposals aim to ensure that a digital euro would be widely accepted as a means of payment, and be accessible through banks. Furthermore, basic digital euro services would be available for free, with provisions to protect user data and minimize the risks of money laundering and terrorist financing.

While policymakers are setting the groundwork for an official digital currency, it would still be up to the European Central Bank (ECB) to make the final decide to issue it.

The ECB said that the investigation phase of its digital euro project will conclude in October. After that, the governing council of the ECB will decide whether to move to the next phase of the project, which would involve developing and testing technical solutions and business arrangements.

“The legislative proposal is key to ensuring that the digital euro brings value to the people, taking the appreciated features of cash into the digital sphere,” said Fabio Panetta, ECB executive board member and chair of its task force on the digital euro, in a release.

“The ECB also welcomes the commission’s proposal on the legal tender status of euro cash, to ensure banknotes remain easily accessible for citizens and businesses and widely accepted throughout the euro area,” he added.

“We look forward to continuing working together with other EU institutions towards a digital euro to ensure our currency is fit for the digital age,” said ECB president Christine Lagarde in a release.