Digital euro: The plan to Trump-proof the EU's economy

Lead

The European Union has taken a significant step toward creating a digital euro, as the European Central Bank (ECB) pushes forward with plans for a state-backed electronic currency. The digital euro is designed to offer a simple and secure way to make payments in shops, online, or between individuals, backed directly by Europe's central bank. As reported by RFI English, the European Parliament's economic committee approved its position on the regulation after three years of negotiations between the ECB and European banks.

Coverage Comparison

Deutsche Welle's reporting frames the digital euro as both a digital upgrade and a geopolitical necessity. The broadcaster emphasizes that the ECB's initiative is in large part a response to a shifting international landscape. According to DW, EU policymakers view currency sovereignty as a form of "insurance" against potential moves by the Trump administration, such as sudden changes to trade rules, tariffs, or AI export controls. Europe, EU officials argue, is heavily dependent on American-owned payment infrastructure, including Visa, Mastercard, Apple Pay, Google Pay, and PayPal.

RFI English, by contrast, casts the news in a similar light but focuses on the parliamentary and institutional process. The outlet reported that the ECB secured key parliamentary backing on Tuesday, with the economic committee's approval seen as a milestone. The outlet also details the broader motivation: making the eurozone less reliant on American-owned payment systems such as the ones named above, which are increasingly seen as "instruments of power". Both outlets — DW and RFI English — agree on the central facts: that a digital euro would sit in a hands of the ECB, that these accounts would require users to hold a separate account with a bank or public institution, and that the ECB hopes for a launch by 2029.

Key claims

Design and usage: According to Deutsche Welle, the ECB plans to enable peer-to-peer payments directly between phones, allowing people to use a card, an app, or their banking app in a way that feels familiar. RFI English specifies that digital euros would have the same value as cash and banknotes. To use it, users will need to create an account with a bank, or a public institution such as a post office, then transfer money into this from another account or through a cash deposit. They can then pay with digital euros in shops, online, and between individuals, using different methods including a card, app, or phone.

Measures to protect banks. Both DW and RFI English carry the detail that the digital euro would pay no interest, removing incentives to shift savings out of banks. Deutsche Welle reports that a possible cap on holdings — in the range of €3,000 — would automatically redirect any excess back to a linked bank account. These aspects appear to respond to concerns from European banks about deposit outflows and lost revenues, which RFI English says had sought to limit the scope of the project.

Payments market. RFI English reports that the ECB says nearly two-thirds of card payments in the eurozone are handled by non-European companies. DW adds that many payment applications, including Google Pay, Apple Pay, and PayPal, add another layer of dependence on the United States.

Geopolitical push. Both outlets relate the move to broader global currency dynamics. Deutsche Welle, in particular, notes that other major economies such as China are moving similarly, with more than 230 million personal and about 18.8 million corporate wallets created for China's digital yuan since a pilot was launched in 2020. Bas van Donselaar, managing partner at the PaymentGenes Consultancy, told DW that if all transactions globally became dollar-denominated without a digital euro, it would limit the effectiveness of ECB monetary policy on the traditional euro. According to RFI English, the digital euro aims to reduce reliance on American-owned infrastructure.

Next steps. The digital euro cannot be created unless the rules underpinning the project are approved by EU capitals and the European Parliament, according to RFI English. The ECB first suggested the digital euro in 2020, with the European Commission making a formal proposal later. The most recent vote was for the economic and monetary affairs committee to adopt its position. The ECB hopes the digital euro will be available to EU citizens by 2029, if EU negotiators approve the rules by the end of this year, RFI reported. A pilot could begin next year, with a full rollout in 2029, DW reports.

Perspectives

ECB / EU officials: The push for a digital euro stems from a desire to ensure currency sovereignty, as Washington can shift trade rules and tariffs. In that view, digital euro ensures that an EU payment system exists in the digital age, lessening the reliance on dollar-denominated sectors.

European banks: European banks were reported to have raised concerns about deposit outflows and lost revenues, and tried to limit the project's scope. The design parameters — a possible cap on holdings, no interest, and a transfer of excess to linked bank accounts — address those concerns.

Consultants / third-party observers: Bas van Derselaar of the PaymentGenes Consultancy, speaking to DW, argues that without a digital euro, global transactions in dollars could limit the ECB's monetary policy effectiveness.