ESBG’s new position paper on the digital euro highlights pivotal open issues to be addressed by the legislators

Following the publication of a proposal for a Regulation on the establishment of the digital euro on 28 June 2023, the European Commission launched a public call for feedback on the legislative proposal. Over the last weeks, ESBG members collected their considerations in a position paper on the Regulation which has been submitted to the European Commission on 8 September 2023. The paper highlights pivotal open issues that need to be addressed by the legislators in the upcoming debates.

Among others, ESBG members call for a qualified opinion of the European Court of Justice to clarify the legal basis of the proposed Regulation and recommend to carry out an impact assessment by a neutral party or the European Central Bank before introducing a digital euro to assess the consequences for financial institutions, market competition, and overall economic stability holistically.

In addition, ESBG members stress that initial individual holding limits should be capped at EUR 1,000, offering sufficient flexibility for daily transactions while maintaining financial stability. Building on this, the paper underlines to frame the digital euro as a means of payment rather than establishing a new payment scheme to leverage on existing infrastructure and foster innovation.
Overall, ESBG members outline that many questions on its technical implementation, legal basis, financial stability and market competition remain open and need to be addressed before issuing a digital euro.