Cipollone outlines ECB digital money strategy

Piero Cipollone, Member of the Executive Board of the European Central Bank, outlined the Eurosystem's comprehensive payments strategy, highlighting the digital euro as a digital form of cash for retail payments.

This initiative aims to ensure an integrated, innovative, and competitive European payments market, supporting monetary policy effectiveness and financial stability.

The digital euro will be available across the euro area, both online and offline, complementing physical cash and offering freedom of choice.

EU-licensed payment service providers, especially banks, will distribute it, preserving customer relationships and receiving fair compensation.

Safeguards include holding limits and no remuneration.

The digital euro also establishes a European acceptance infrastructure, fostering innovation for private providers.

The preparation phase is ongoing, with a 12-month pilot scheduled for the second half of 2027.

A potential first issuance is targeted for 2029, pending EU legislative adoption.

Cipollone detailed the Eurosystem's strategy for modernising central bank money in wholesale transactions.

Tokenisation offers efficiency and innovation by enabling shared, interoperable ledgers.

The ECB's response includes tokenised central bank money as a risk-free settlement anchor, expanding the digital asset market.

Pontes, launching September 2026, will connect DLT platforms with TARGET Services for central bank money settlement.

Appia, with a 2028 blueprint, aims to foster an integrated tokenised ecosystem.

Additionally, the ECB is enhancing global cross-border payments by exploring TIPS interlinking with systems in India, Switzerland, and Brazil, and participating in Project Agorá with the BIS to develop a multi-currency shared platform.