The European Commission announced Wednesday it will propose a bill in early 2023 to introduce a digital euro, according to a report by Politico.
- The European Central Bank (ECB) is already experimenting with the digital euro and is expected to begin working on a prototype by the end of next year.
- A digital euro is expected to be ready as soon as 2025 if the European Union makes a decision on issuance.
- A digital euro would be the European Union’s central bank digital currency (CBDC), which many countries are already beginning to explore, most notably China.
- European lawmakers are concerned the rise of other CBDCs, privately-backed cryptocurrencies like formerly Meta-backed Diem and Bitcoin could undermine the demand for their fiat.
- “If we don’t satisfy this demand, then others will do it,” ECB Executive Board member Fabio Panetta said in November, advocating for the creation of the digital euro.