Cash Getting Crushed? Digital Euro Moves Ahead

The European Central Bank just said its digital euro is moving into the next phase.

The digital euro is a digital form of cash, issued by the central bank and available to everyone in the euro area.

On Oct. 30, Brussels said that if legislation in place in the course of 2026, a pilot exercise could start in 2027 and the Eurosystem should be ready for a potential first issuance of the digital euro during 2029.

The EU claims says “a digital euro will preserve Europeans’ freedom of choice and privacy and protect Europe’s monetary sovereignty and economic security.”

“The euro, our shared money, is a trusted sign of European unity,” said ECB President Christine Lagarde. “We are working to make its most tangible form – euro cash – fit for the future, redesigning and modernising our banknotes and preparing for the issuance of digital cash.”

Though some banks seem to be pushing back.

“Why invest billions in a new digital currency that no one wants?” mulled Michael Anseeuw, CEO of BNP Paribas Fortis and chairman of Belgian banking federation.

Political philosopher David Thunder called the digital euro an intrusive form of “economic surveillance” on X.

“The common currency is “a symbol of trust in our common destiny.” But creating a Central Bank Digital Currency erodes that trust by opening up the door to real-time monitoring of our payments and spending habits,” he said.

“There are surely safer ways to digitise currency, and ensure central banks cannot engage in intrusive forms of economic surveillance, but the European Union apparently has no interest in exploring them,” he added.

Spare a thought for cold hard cash in Europe. 

The EU’s also rolling out its Anti-Money-Laundering Regulation, which slaps a €10,000 limit on cash payments and demands ID for anything above €3,000.

From 2027, handing over a wad of notes for a used car or building job could make you look like you’re laundering cartel money for El Chapo.

Meanwhile, the UK pound is still paper and knocking about, for now.

The Bank of England is flirting with its own central bank digital currency (CBDC) “digital pound” but hasn’t seems to have pulled the levers yet.

Waiting for Labour’s mandatory national digital ID scheme to kick in?