Fabio Panetta, a member of the executive board of the European Central Bank, said a digital euro could be ready in 2026.
Central Bank Digital Currencies (CBDCs) are a red rag to cryptocurrency maximalists.
Panetta sang the praises of a digital euro, saying it would "fortify [...] monetary sovereignty" and "add value for users, foster innovation, and enjoy strong political and societal support."
In his speech, Panetta went into the role of public money (issued by a national government) and private money (crypto, but also non-cash payments). He stressed that surrendering the field of payments to non-European payment providers increases the risks to Europe's strategic autonomy and threatens its monetary sovereignty.
Public money is ultimately a superior form of money, according to Panetta:
"Confidence that "one euro is one euro" whatever form it takes rests on our ability to convert, at par, private money – such as funds held in bank deposits or digital wallets – into public money, which is the safest form of money available."
Panetta contrasted this "safe" public money with stablecoins and pointed out the risk of bank runs, such as experienced by TerraUSD.
Ultimately, a digital euro could be a solution for European countries — it would raise strategic autonomy, offer a free means of payment for everyone, and help smaller intermediaries integrate with digital payment systems.
Panetta pointed out that nine countries already have CBDCs and that the ECB launched a two-year investigation phase in October 2021 to define the digital euro's design features. He concluded:
"Finally, at the end of 2023 we could decide to start a realisation phase to develop and test the appropriate technical solutions and business arrangements necessary to provide a digital euro. This phase could take three years."