European Parliament committee adopts digital euro negotiating position

On Tuesday, the European Parliament's Committee on Economic and Monetary Affairs (ECON) approved its negotiating position on the digital euro legislative package with 43 votes in favor, 14 against, and one abstention. The digital euro will function as a complement to cash and will be issued by the European Central Bank (ECB). It will support both online account-based transactions and offline peer-to-peer payments via local storage devices. For offline use, the loss of a device will result in the loss of stored funds. The proposal emphasizes privacy-by-design, utilizing zero-knowledge proofs to allow transaction verification without disclosing user identities to the ECB. Banks and other payment service providers will be required to offer basic digital euro services, including a free payment card, to citizens at no cost. Additionally, the legislation mandates that merchants cannot unilaterally refuse physical cash payments to prevent financial exclusion. The European Consumer Organisation (BEUC) supported these measures, which also include enhanced security and compensation guarantees for failed digital transactions.