European Parliament adopts negotiating position on the digital euro regulation
The European Parliament approved its position on the digital euro regulation on 9 July 2026, following a committee vote in June. Trilogue negotiations with the Council and Commission were expected to begin by the end of July, with the aim of concluding the file by the end of 2026.
What happened
The European Parliament adopted its position on the digital euro regulation on 9 July 2026. The Economic and Monetary Affairs Committee had approved the text in June 2026, after Parliament resolved a procedural blockage in March 2026 that had held the file up. The file now moves to trilogue, the negotiation between Parliament, the Council of the European Union and the Commission that produces the final text. Banca d'Italia said negotiations were expected to start by the end of July 2026 and that the legislative process was targeted for completion by the end of 2026. In parallel, the Eurosystem is continuing technical design and experimentation work on the digital euro, which cannot be issued until the regulation is in force.
Why it matters
The digital euro is the euro area's answer to the growth of dollar stablecoins in European payments, and the design parameters under negotiation (holding limits, remuneration, distribution through banks and compensation for intermediaries) determine how much deposit substitution it would cause. Those same parameters are being debated in the MiCA review, so the two files are effectively one policy question about who issues euro-denominated digital money. For banks the immediate stake is deposit funding: a generous holding limit shifts retail balances off bank balance sheets, while a tight one limits the digital euro to a payment instrument rather than a store of value.
What is not settled
Holding limits, remuneration and intermediary compensation are not settled; the final text depends on trilogue outcomes that had not begun as of 25 July 2026.
Institutions in this story
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European Parliament
Legislature
The directly elected chamber that legislates alongside the Council of the European Union, and whose economic affairs committee adopted its digital euro position on 23 June 2026, giving the Commission rather than the European Central Bank the power to set holding limits.
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European Central Bank
Central bank
Responsible for euro area monetary policy since 1 January 1999 and operator of TARGET Services, it committed in July 2025 to a two-track approach to distributed ledger settlement: Pontes, piloting in the third quarter of 2026, and Appia.
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European Commission
Regulator
The European Union's executive, holding the sole right to propose EU legislation, and author of both the Markets in Crypto-Assets Regulation and the DLT Pilot Regulation that lets market infrastructures test tokenized trading and settlement.
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Banca d'Italia
Central bank
Eurosystem member and Italy's national central bank, which developed and operates TIPS, the euro area's instant payment settlement platform; its Directorate General holds that central bank money should remain the settlement pivot for tokenized instruments.