ECB says digital euro is a 'strategic lifeline' for banks, not a threat

The European Central Bank (ECB) has described the digital euro not as a threat to banks, but as a strategic lifeline to compete with large tech-based payment companies and stablecoins. In a blog post, ECB Executive Board member Piero Cipollone and Supervisory Board Vice-Chair Frank Elderson called the digital euro "an urgently needed tool to enhance the competitiveness of European banks," BeInCrypto reported. They noted that two-thirds of card transactions in the eurozone are processed by non-European companies, causing local banks to lose ground. The officials explained that the digital euro is designed to place banks at the center of its distribution model, allowing them to manage accounts and retain customer relationships and credit data. To this end, the ECB plans to test the digital euro's infrastructure in 2027.