Half-Time in the ECB’s Digital Euro Assessment

The European Central Bank (ECB) is half-way through its assessment work about whether to launch a CBDC. This has involved extensive consultation. It has published its second progress report on its preparation phase of a digital euro.

The report highlights progress in four areas:

• The Rulebook
• Outsourcing parts of the work
• User design research and design issues
• Holding limits.

Digital euro holding limit debate

Like other central banks, the ECB is planning to limit how much money can be held as digital euros in an account. There is a tension between consumer groups, who want higher limits for usability and convenience, and banking groups, who want lower limits because they can’t lend against deposits held as digital euros. Central banks see this from a financial stability perspective.