The digital euro is designed as a secure, private, and free means of payment that works online and offline, issued by the European Central Bank and operating on an account-based system for online use with device-to-device capability when offline.

EU officials and ECB President Christine Lagarde say the digital euro is needed to protect Europe’s monetary sovereignty and to reduce reliance on U.S.-dollar–pegged stablecoins and foreign payment networks like Visa and Mastercard.

Overall, the framework aims to establish a sovereign digital currency with distinct online and offline capabilities, privacy protections, and controlled circulation to balance innovation with financial stability.

The committee approved the position with 43 votes in favor, 14 against, and one abstention, signaling strong support for the digital euro’s policy framework and the tripartite legislative package.

The European Parliament’s Economic and Monetary Affairs Committee approved the legal framework for the digital euro and called for immediate trilogue talks to finalize the law, ending three years of clashes between central and commercial banks.

Markus Ferber, a leading ECON committee member, framed strengthening European payment resilience as a geopolitical necessity amid ongoing tensions.

Holding limits are favored by commercial banks to prevent mass exits from traditional bank accounts during crises.

The European Commission welcomed the first parliamentary approval of the regulatory framework, highlighting greater EU autonomy in digital payments as an alternative to Visa and Mastercard.

Holding limits would be set by the European Commission based on ECB recommendations and reviewed periodically; private banks would not hold permanent digital-euro balances, except to process payments within a 24-hour window.

Most businesses would be required to accept digital-euro payments, with exemptions for self-employed individuals and very small businesses that do not use other digital payment methods.

Aurore Lalucq, president of the ECON Committee, called the vote historic as the negotiating position was green-lit within the broader digital currency package.

Negotiations will continue with EU member states in the Council before final legislative adoption of the digital-euro framework.