It aims to reduce dependence on US payment networks like Visa and Mastercard and on digital wallets such as Apple Pay and Google Pay.

A German-led research group warns budget strain and constrained core infrastructure funding, highlighting concerns about feasibility and resource allocation.

Some researchers argue the account-based design may not guarantee true privacy, warning that identity and transaction data could be linked via ECB identifiers.

Safeguards outline basic free services and broad acceptance by businesses, with exemptions for self-employed and small/medium-sized enterprises.

The digital euro is a central bank digital currency issued by the European Central Bank, designed to complement cash and existing banking services rather than replace them, usable online and offline with strong privacy protections and minimal exposure of personal data.

Intense negotiations are expected to intensify in autumn, with final approval targeted by year-end.

There is a major dispute over how fees will be distributed across the payment chain, with merchants potentially benefiting from lower card transaction costs.

A central clash in talks is the compensation model: who gets paid, how much, and how digital euro services are funded.

The project envisions a balance between account-based and token-based approaches, with debate over privacy, security, and feasibility guiding design choices.

Negotiators aim to strike a deal by the end of 2026, potentially making the digital euro available to citizens in 2029 after a pilot starting in 2027.

The European Parliament approved its position in the first reading, clearing the path for trilogue negotiations to begin, with a decisive vote in favor by 416 MEPs, 169 against, and 22 abstentions.

There are competing ideas from research groups and open-source approaches, including double-blind signatures and related concepts, with limited ECB backing so far.