The European Union continues to plow forward with Central Bank Digital Currency (CBDC), unlike the US, which has chosen privately issued stablecoins as a preferred option to enable digital dollars as well as fuel innovation.
In a Christmas update, European Central Bank (ECB) President Christine Lagarde mentioned the CBDC issued by the ECB as the top project for 2026.
In a self-congratulatory post, Lagard said that inflation is down to where they want it, while sharing that the Governing Council has given the go-ahead to issue the CBDC while they wait for the European Parliament to come up with “final legislation,” which will lead to the pilot phase and then the launch.
The second big project of the ECB for 2026 is an update to the Euro banknotes.
The pilot phase is anticipated to begin in 2027 with a launch of the digital Euro following in 2029.
The ECB is considering certain limitations on the digital Euro, such as caps on the amount held by individuals.
While there are details that need to be worked out, the US-approved legislation (the GENIUS Act) has seen interest in stablecoins rise dramatically. Digital dollars issued by firms like Tether and Circle currently dominate the marketplace. Tether (USDT) has a market cap of around $186 billion. Circle’s USDC is around $76 billion.
Policymakers chose privately issued digital dollars in the US to better safeguard against privacy concerns. There is also the fact that private firms are more inclined to innovate and improve the issuance and usage of these digital assets. There is the added benefit of boosting the dollar as a global reserve currency as well as an anticipated increase in demand for US Treasuries.
2025 has been a year marked by uncertainty, challenges, and hard work.
As we head into the festive season, wishing you all a happy and restful holiday.✨ pic.twitter.com/nKhpV4d3l5
— Christine Lagarde (@Lagarde) December 24, 2025
