Is the EU using the digital euro to take control of your wallet?

Discussion about the digital euro has been constantly growing since it was first announced back in 2021, with conflicting narratives and even conspiracies about the currency cropping up online as the months go by.

The European Central Bank (ECB) describes it as an "answer in a world of change", with features such as enhanced privacy, universal acceptance and free basic use, while certain consumers claim it's a tool for the EU to control people's money.

A petition, which has gathered more than 388,000 signatures, was published online in November, calling on MEPs and national governments to reject the digital euro.

But how true are the claims that the digital euro will block citizens from effectively controlling their own money? Euronews' fact-checking team, The Cube, took a look at the evidence.

How would the digital euro work?

Last week, the ECB announced plans to "prepare for a possible rollout of the digital euro by 2029".

Initial trials of the digital currency could begin as early as mid-2027 — but only if MEPs approve the necessary regulation in 2026.

The digital euro would be a new form of central bank money — in other words, real money issued by the European Central Bank, but in digital form.

As things stand, the only way for the public to hold central bank money is in cash. The digital euro would make it possible to hold this same sovereign money in a digital wallet, accessible, for example, via a smartphone.

In practical terms, payments could be made in shops using a phone, much like with a bank card today. However, paying with a digital card and paying with a digital euro are not the same.

Card payments, whether physical or digital, are processed through private banks or payment service providers. The digital euro, by contrast, would be issued directly by the ECB — like banknotes — without intermediaries.

This payment method will be complementary to cash and is not intended to replace it, serving as an additional choice for consumers and businesses.

Less freedom in exchange for greater control?

The project, presented by ECB President Christine Lagarde, is receiving growing political backing.

At a eurozone summit in October, European leaders called for faster progress to strengthen Europe's monetary sovereignty, economic security and competitiveness in the payments sector.

However, concerns remain over the protection of users' data, particularly when looking through the lens of China, which has been testing its digital yuan on a large scale since 2020.

In 2024, Chinese authorities continued rolling out the state-issued digital yuan, using it as a tool to monitor and restrict financial activity linked to illegal sectors such as gambling, with transactions subject to oversight through a centrally controlled digital payment system.

The ECB, for its part, says it's committed to striking a balance between traceability and privacy. The EU's General Data Protection Regulation (GDPR) is also expected to provide safeguards for users of the digital euro, so it's not right to say that the currency will lead to the EU having total control over consumers' wallets.

Belgian economist Bruno Colmant, who has previously warned about the potential risks of control associated with the digital euro, also raised concerns about hacking.

He told The Cube that "the entry point for the digital euro is a commercial bank — those dealing with individuals, businesses and public authorities". This means that "even without their knowledge, these banks could be used to trace digital euro transactions," he added.

That said, he stressed the need for a nuanced debate on the issue.

The maximum amount an individual would be allowed to hold in digital euros with the ECB is commonly said to be around €3,000. The cap would apply only to digital euro balances and has not yet been finalised in legislation, and it doesn't limit a person's overall assets or bank account holdings. Even so, Colmant said that the risk of some control "is not zero".

"There is potentially a loss of privacy protection, because this digital euro could be traced, and it would be possible to know exactly what it is being used for," he said.

It should also be noted that no precise legal framework for the digital euro has yet been adopted. MEPs are expected to adopt the relevant regulation by 2026, a prerequisite before any implementation of the project can take place.

Moving away from reliance on foreign payment companies

Some bankers have voiced concerns and scepticism about the creation of the digital euro.

The chief executive of the French bank Crédit Mutuel, Daniel Baal, wrote on LinkedIn that the digital euro "does not meet any clear need for citizens" and offers "no substantial advantage over existing payment methods".

Michael Anseeuw, the chief executive of BNP Paribas Fortis Belgium, told Belgian news outlet L'Echo that the ECB's digital currency project was a "false good idea", describing it as "superfluous", while pointing to the development of new European payment alternatives such as Wero.

Nevertheless, the ECB says one of the objectives of this complementary currency is to "reduce dependence on non-European providers".

The US giants Visa and Mastercard account for around 70% of the card payment market in Europe. Colmant pointed out that Europe's commercial banks "use Visa and Mastercard, even though the licence is American".

Valdis Dombrovskis, European Commissioner for the Economy and Productivity, has stressed the importance of ensuring Europe's strategic autonomy and avoiding reliance on foreign payment systems, particularly as online commerce continues to grow.