Digital Euro Must Serve Public Interest: 70 European Economists Issue Urgent Warning

In a significant development for European financial policy, a coalition of 70 prominent economists and policy experts has issued a compelling call to action. They demand that the proposed digital euro must unequivocally serve the public interest. This urgent appeal, directed at members of the European Parliament, arrives at a critical juncture in the continent’s monetary evolution. The experts argue that Europe’s financial autonomy hangs in the balance.

Digital Euro Must Anchor European Monetary Sovereignty

The open letter, reported by Crypto News Insights, presents a clear and urgent case. The economists assert that a central bank digital currency (CBDC) represents far more than a technological upgrade. Instead, it serves as a vital instrument for safeguarding Europe’s monetary sovereignty in an increasingly digital world. As physical cash usage continues its steady decline across member states, public access to central bank money faces a fundamental challenge. Consequently, the digital euro emerges as the necessary public infrastructure to fill this growing void.

Furthermore, the group emphasizes the project’s foundational principles. They insist the digital euro must function as a public digital payment method issued directly by the Eurosystem. This system would need universal usability across all eurozone nations. Critically, the experts advocate for basic services to remain free of charge, ensuring equitable access for all citizens regardless of economic status. This approach starkly contrasts with many private sector alternatives.

The Critical Role of a Public Digital Payment Infrastructure

The economists’ letter provides a detailed vision for the digital euro’s implementation. They frame it not as a replacement for physical cash, but as its essential digital complement. This dual-system approach aims to preserve consumer choice and financial inclusion. The experts highlight several non-negotiable design features for the proposed currency:

• Public Issuance: The Eurosystem must retain full control over issuance and governance.
• Pan-European Usability: Seamless functionality across all 20 eurozone countries.
• Free Basic Services: Core transactional services provided without user fees.
• Privacy Standards: Robust data protection aligning with EU regulations like GDPR.
• Offline Functionality: Capacity for transactions without immediate internet access.

This framework directly addresses growing public concerns over privacy and accessibility in digital finance. Moreover, it positions the digital euro as a public good rather than a profit-driven product.

Historical Context and Global CBDC Developments

The European push for a digital currency occurs within a rapidly evolving global landscape. Major economies worldwide are actively exploring or deploying their own CBDCs. For instance, China has advanced trials of its digital yuan, while the Bahamas has fully launched the Sand Dollar. The Bank of England continues its digital pound research, and the United States explores a potential digital dollar. This global race underscores the strategic importance of the European project.

The European Central Bank (ECB) initiated its digital euro investigation phase in October 2021. This phase followed a comprehensive public consultation that gathered over 8,000 responses. The current preparation phase, launched in October 2023, involves finalizing rules, selecting providers, and conducting extensive testing. A final decision on issuance will follow this rigorous process, likely by 2025.

Consequences of EU Hesitation on Payment Autonomy

The coalition’s letter delivers a stark warning about the risks of delay or inaction. They caution that any hesitation by European Union institutions could cede critical ground. Specifically, non-European card networks and Big Tech payment firms might achieve market dominance. Such an outcome would carry profound implications for Europe’s economic independence.

Foreign control over payment infrastructure presents several clear dangers. It could undermine the Eurosystem’s ability to implement effective monetary policy. It might also compromise the EU’s capacity to respond decisively to financial crises. Additionally, it could expose European transaction data to jurisdictions with conflicting legal standards. The economists argue that a sovereign digital euro provides the definitive solution to these vulnerabilities.

Recent market trends amplify these concerns. Private digital payment solutions continue to consolidate their user bases. Meanwhile, geopolitical tensions highlight the strategic value of autonomous financial systems. Therefore, the digital euro project transcends technical discussion. It represents a core component of Europe’s strategic autonomy in the 21st century.

Expert Perspectives on Design and Implementation

The collective expertise of the 70 signatories lends significant weight to their recommendations. These individuals hail from leading universities, research institutes, and policy organizations across Europe. Their consensus highlights the technical and economic feasibility of a public-interest-oriented digital euro. They reference successful models of public digital infrastructure, such as national real-time payment systems.

Key design considerations include interoperability with existing banking systems. The digital euro should integrate smoothly with commercial bank accounts and payment services. It must also ensure a high degree of resilience and security against cyber threats. The experts stress that these technical challenges, while substantial, are entirely surmountable with sufficient political will and investment.

Broader Economic and Social Impacts of a Digital Euro

The introduction of a well-designed digital euro promises wide-ranging benefits for European society. It could significantly enhance payment efficiency, reducing transaction costs for businesses and consumers. It may also foster greater financial inclusion for underserved populations. For example, individuals without traditional bank accounts could access digital payments through the central bank.

From a monetary policy perspective, a digital euro offers new tools for the ECB. It could enable more direct and efficient implementation of policy decisions. However, the economists caution that these powers require careful democratic oversight. The letter explicitly warns against programmable features that could restrict spending, emphasizing the currency’s role as a tool for freedom, not control.

The environmental impact also warrants consideration. A digital euro could potentially reduce the carbon footprint associated with producing and transporting physical cash. However, its energy consumption for digital processing must adhere to strict sustainability standards. The ECB has already committed to an environmentally neutral approach for the project.

Conclusion

The call from 70 European economists presents a clear roadmap for the digital euro. They argue convincingly that this initiative must serve the public interest above all else. Protecting monetary sovereignty, ensuring free basic services, and complementing physical cash form the project’s essential pillars. Any failure to act decisively risks surrendering Europe’s payment autonomy to foreign corporations. Therefore, the digital euro represents not merely a financial innovation, but a foundational element of European strategic independence for the digital age. The coming months will prove crucial as EU policymakers weigh this expert advice against competing pressures.

FAQs

Q1: What is the main demand of the 70 European economists regarding the digital euro?
The economists demand that the digital euro must be designed primarily to serve the public interest. They emphasize it should be a public payment method with free basic services, complement cash, and protect Europe’s monetary sovereignty from foreign payment dominance.

Q2: Why do experts say the digital euro is necessary for monetary sovereignty?
As cash usage declines, public access to central bank money diminishes. A digital euro issued by the Eurosystem ensures citizens retain direct access to sovereign money. This prevents Europe’s payment infrastructure from becoming dependent on non-European private companies, preserving policy autonomy.

Q3: How would the digital euro differ from private payment apps like PayPal or Apple Pay?
The digital euro would be public money, a direct liability of the central bank, similar to physical cash. Private apps are liabilities of commercial companies. The digital euro would offer universal access, free basic services, and robust privacy protections as a public good, not a profit-driven service.

Q4: Will the digital euro replace physical euro banknotes and coins?
No. The economists explicitly state the digital euro should complement, not replace, physical cash. Both forms would coexist, ensuring choice and accessibility for all citizens, particularly those who rely on or prefer cash transactions.

Q5: What are the risks if the EU delays or abandons the digital euro project?
The primary risk is market dominance by non-European card companies and Big Tech payment firms. This could undermine Europe’s control over its payment infrastructure, compromise transaction data privacy, and limit the ECB’s ability to implement effective monetary policy during crises.