The ECB has launched technical tests for a Community digital currency. The Governing Council of the European Central Bank has started the analysis phase of the project for a digital euro. The 24-months analysis phase will address key issues related to the definition of technical characteristics and distribution. A digital euro must be able to respond to the needs of European citizens, while at the same time helping to prevent illegal activities and prevent undesirable effects on financial stability and monetary policy. This will not prejudice a future decision on the possible issuance of a digital euro, which will be taken only at a later time. In any case, the new digital currency would complement the cash, without replacing it.
During the project analysis phase, the Eurosystem will focus in particular on the definition of possible functional features based on user needs. It will be a conceptual work, which will involve in-depth groups, in order to define prototypes. In the analysis phase, consideration will be given to the uses that a digital euro should give priority to achieving its objectives: an efficient, accessible and risk-free form of central bank digital money.
The analysis phase will assess the possible impact of a digital euro on the market, identifying options to ensure privacy and avoid risks for euro area citizens and intermediaries and for the wider economy. A business model will also be defined for supervised intermediaries in the digital euro ecosystem, and a market advisory group will take into account the views of potential users and distributors on a digital euro. These views will also be discussed by the Euro Retail Payments Committee.