The Central Bank of Latvia published an explainer on why the timing of a digital euro remains uncertain, stressing that the Eurosystem can prepare the technology but cannot issue a digital euro without an EU legal framework. It notes that if the digital euro regulation is adopted in 2026, issuance could begin in 2029, while any legislative delay would materially affect that timetable. The update summarises the EU law-making process and recent milestones: the European Commission tabled its proposal on 28 June 2023, and the Council of the EU adopted its position on 19 December 2025, largely aligned with the Commission’s direction but with clarifications on security, holding limits, the compensation model and data protection. The European Parliament has moved more slowly amid political disagreement over whether a digital euro is needed and, if so, its design, including a proposal to prioritise an offline-only version to limit online functionality. A plenary vote on 10 February 2026 supported having both online and offline versions, but negotiations continue on core elements such as the compensation model, the role of financial service providers and the principles for setting holding limits, leaving the start of trilogues in summer 2026 uncertain. On implementation, the Eurosystem is continuing infrastructure development based on the Commission’s initial design and the Council’s amendments, using a gradual approach intended to preserve flexibility if the regulation text changes. The note argues that keeping technical work progressing should shorten the implementation phase once the regulation is adopted compared with pausing the project until a final political decision is made.
Central Bank of Latvia 2026-04-14
Central Bank of Latvia explains digital euro delays and links potential 2029 issuance to EU regulation
The Central Bank of Latvia said the timing of a digital euro remains uncertain because issuance depends on an EU legal framework, with a 2029 launch only feasible if regulation is agreed in 2026. The update highlights divergent positions in the European Parliament on the need for a digital euro and its design, ongoing negotiations on the compensation model, holding limits and the role of financial service providers, and uncertainty over when trilogue talks will begin. It adds that the Eurosystem is continuing gradual infrastructure development aligned with the European Commission proposal and Council amendments to preserve flexibility and shorten implementation once regulation is adopted.