The European Parliament has approved a framework for a digital euro, aligning with recent EU government support. The proposed central bank digital currency would function both online and offline, with privacy and resilience emphasized. The move comes as U.S. dollar-denominated stablecoins dominate over 90% of the global stablecoin market, which has a total value exceeding $300 billion.
The European Parliament has formally backed the creation of a digital euro, clearing a key procedural hurdle. Lawmakers voted 429 in favor, 109 against, with 44 abstentions to endorse the negotiating mandate.
This aligns the Parliament with EU governments and marks the most significant political step forward for the project to date. The digital euro would be issued by the European Central Bank as a central bank digital currency with the same legal tender status as cash.
Crucially, it would be usable both online and offline, enabling payments without an internet connection. Supporters argue offline functionality is essential for resilience and privacy, particularly for small-value transactions.
“The digital euro must be usable anytime, anywhere, whether online or offline,” said German MEP Stefan Berger, the Parliament’s lead negotiator. The legislative push comes amid overwhelming dollarization in crypto payments.
Data from CoinGecko shows USD-denominated stablecoins account for well over 90% of the global stablecoin market. The sector’s total market capitalization is over $300 billion.
Tokens like Tether’s USDT and Circle’s USDC dominate, with a combined market cap nearing $260 billion. In contrast, euro-based stablecoins have a combined market value of less than $1 billion.
EU officials have framed the digital euro as a way to reduce reliance on private, foreign-currency payment instruments. The move is seen as a strategic response to preserve monetary sovereignty as crypto adoption expands.
The ECB is expected to decide in the coming months whether to move the digital euro into its next development phase. This follows a two-year investigation that concluded the project was technically feasible.
Even with advancing legislation, a launch would likely occur around 2029. For now, the Parliament’s vote signals political momentum rather than immediate deployment.
