Seventy European academics have urged EU legislators to support a comprehensive digital euro, with their call highlighting deepening tensions over whether a central bank digital currency (CBDC) should compete with private payment solutions and what impact it could have on bank lending.
The academics warned that political negotiations risk leaving Europe increasingly dependent on US payment infrastructure. Their letter noted that in thirteen euro-area countries, basic retail payments now rely entirely on international card schemes without any domestic alternative. They cautioned that without a meaningful digital euro, US backed private stablecoins could fill the void as demand grows for programmable payments.
However, private sector initiatives are making substantial progress. The organization behind digital wallet WERO is collaborating with EuroPA. Together the two solutions will cover 382 million people representing 84% of the EU population plus Norway. Additionally, allowing citizens to hold substantial amounts in digital euros could drain bank deposits, potentially constraining banks’ ability to provide credit to the economy.
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