The European Central Bank (“ECB”) is assessing the potential issuance of the digital euro (“D€”) in collaboration with the national central banks of the Eurosystem. On 29 October 2025, the Governing Council of the ECB decided that the Eurosystem will continue the digital euro project after the successful completion of the preparatory phase which has begun in November 2023. The final decision on whether to issue the D€ will be made following the adoption of the relevant legislative framework at the European level.

The D€ issued by the central banks of the Eurosystem would be a central bank digital currency, an electronic equivalent to cash. It would be stored and managed in a digital wallet for the purpose of processing payment orders. In addition to an online function, the D€ would also have an offline function, allowing transactions to be carried out even without an internet connection.

Legal Basis

The relevant legal basis (currently) consists of the Draft of the ECB Digital Euro Scheme Rulebook (currently version v0.9 dated 30 June 2025) (“D€-Rulebook”) and the European Commission’s Draft Regulation on the establishment of the digital euro dated 28 June 2023 (2023/0212 (COD)) (“D€-Draft-Regulation”).

The D€-Draft-Regulation is a proposal by the European Commission, whereas the D€-Rulebook is being drafted by the Eurosystem, in particular the ECB in cooperation with the Scheme Rulebook Development Group.

These drafts are not final, that means the preliminary findings presented in this article can be subject to change.

Contractual Relationships

D€-users shall not have any contractual relationship with the ECB or the national central banks in the Eurosystem. Instead, for the purposes of D€ payment services D€-users only enter into a contractual relationship with payment service providers (“PSP”) (Art. 13 Para. 6 D€-Draft-Regulation).

The PSPs enable the users to hold and transfer the digital euro provided, but the underlying funds are a liability of the central bank.

D€-Rulebook

The set of rules described in the D€-Rulebook for participants named therein, describes a governance structure that sets out rules and standards for the establishment of the D€ (“D€-Scheme”).

The D€-Rulebook substantiates the provisions of the D€-Draft-Regulation and notably aims to ensure that PSPs participating in the D€-Scheme enable payees obliged to accept the D€ – particularly merchants – to do so through harmonised structures.

Obliged Parties Pursuant to the D€-Rulebook

Participants in the D€-Scheme are exclusively PSPs within the meaning of Art. 4 No. 11 PSD2 (or, in future, Art. 2 No. 12 PSD3-Draft and Art. 3 No. 14 PSR-Draft).

The D€-Rulebook contains a set of obligations for D€-Scheme-Participants. However, it also influences the legal relationship between D€-Scheme-Participants and other involved parties (e.g. D€-users or third-party service providers without being D€-Scheme-Participants) as it contains requirements for contracts between D€-Scheme-Participants and other involved parties. Therefore, other involved parties are also required to implement some of the provisions of the D€-Rulebook.

Mandatory D€-Scheme-Participants are:

• Account servicing PSPs that are subject to the obligations of Art. 13 D€-Draft-Regulation and at least hold the payer’s or payee’s linked non-D€ payment account which can be used for funding and defunding of a D€ payment account; and
• Credit institutions that are subject to the obligations of Art. 14 D€-Draft-Regulation and at least provide D€ payments services to the payer or the payee.

Other PSPs may choose to join the D€-Scheme voluntarily.

All D€-Scheme-Participants are required to meet the eligibility criteria and complete the adherence process outlined in the D€-Rulebook.

Essential Obligations in Case of the Establishment of the D€

Payee

Payees (anyone who is the intended recipient of funds which have been the subject of a D€ payment transaction) are obliged to accept the D€ at full face value with the power to discharge from a payment obligation (Art. 7 Para. 2, 4, 5 D€-Draft-Regulation), unless an exception applies (Art. 9 D€-Draft-Regulation).

D€-Scheme-Participants

The main obligations of D€-Scheme-Participants offering D€ payment services include:

• Granting access to the D€, in particular management of D€ payment accounts in compliance with technical and functional requirements and risk management requirements;
• Funding and defunding to and from D€ accounts and complying with the holding limit for D€ payment accounts;
• Processing of D€ payment transactions;
• Dispute management;
• Responsibility for the user experience;
• Compliance with the D€ brand rules.

The obligations of the respective D€-Scheme-Participant under the D€-Draft-Regulation depend on whether it is a credit institution within the meaning of the CRR, a PSP within the meaning of PSD2 (or, in future, the PSD3-Draft and PSR-Draft) or an account servicing PSP within the meaning of PSD2 (or, in future, the PSD3-Draft and PSR-Draft).

Third-Party Service Providers (Other Involved Parties)

(Potential) third-party services providers are the parties contracted by one or several of the PSPs participating in the D€-Scheme to support their provision of D€ payments services.

According to the D€-Rulebook, a third-party service provider (provided not being a participating PSP) is only subject to obligations that are contractually imposed by D€-Scheme-Participants in accordance with the D€-Rulebook.

Inter alia, third party service providers are required to ensure the conformity of products and acceptance solutions offered by them, such as POS terminals. In addition, certain third-party service providers, such as POS terminal providers, are required to have their products certified.

Outlook

It is yet to be determined if and when the D€ will be established.

Following the successful completion of the preparatory phase, the Governing Council of the ECB has decided to move on to the next phase of the digital euro project. The Governing Council’s final decision on whether and when to issue the D€ will only be taken once the legislative framework for the D€ at the European level has been adopted.

It can already be anticipated that the establishment of the D€ would have significant implications for the financial sector. In particular, adjustments would have to be made in the following areas:

• Products and acceptance solutions, such as POS terminals (including their certification);
• Account structures and regulatory security measures;
• Cooperation agreements with third-party service providers, other PSPs, and other contractual arrangements;
• Fee models with regard to fee caps pursuant to Art. 15 Para. 2 in conjunction with Art. 17 Para. 2 D€-Draft-Regulation.