The rapid digitalisation of payments and the steady decline in cash usage are exposing a structural weakness in Europe’s payments landscape: the absence of a pan-European digital means of payment for the general public, alongside a heavy reliance on non-European private providers. At the same time, the development and the innovation of digital transactions, the rise of non-bank actors are reshaping retail payments and raising new questions around sovereignty, resilience and governance.

The digital euro is intended as a response to these developments. Beyond its monetary dimension, it is a strategic project aimed at ensuring that public money remains usable in the digital age, while supporting financial inclusion, competition and the resilience of the European payments ecosystem. It is conceived as a dual initiative, beside a wholesale digital euro—designed to support the settlement of tokenised assets in central bank money—and a retail digital euro, meant to complement cash and anchor everyday digital payments in public money.

The retail digital euro has now entered a decisive phase, as the project moves from conceptual design toward operational preparation, in parallel with ongoing legislative negotiations at EU level. As the focus shifts from principles to execution, key challenges remain: defining its added value vis-à-vis existing payment solutions, ensuring effective governance and interoperability, calibrating safeguards for financial stability, and containing implementation costs. Against this backdrop, the digital euro is increasingly framed not as a purely technical innovation, but as a cornerstone of Europe’s payment resilience and strategic autonomy.