The Sound of Economics Digital euro: why now and what's next
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Jun 18, 2025 
Piero Cipollone, an Executive Board member at the European Central Bank, and Pablo Hernández de Cos, a Bruegel Senior Fellow, dive into the intricacies of the digital euro. They discuss its necessity in the EU, exploring financial stability, holding limits, and the legislative journey since June 2023. The conversation highlights how conditional payments could revolutionize transactions and emphasizes the balance between public and private money. Listeners gain insights into the potential impact of Central Bank Digital Currencies on the future financial landscape.
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Importance of Two-Tier Monetary System
- Central bank money is the only risk-free form of money, crucial for price stability.
- Maintaining the two-tier system of public and private money is vital amid increasing digitalization.
Limit Wallet Holdings and No Remuneration
- Limit digital euro wallet holdings to reduce financial stability risks.
- Avoid remunerating digital euro balances to discourage using it as a store of value.
Avoid Pre-funding Digital Wallet
- Do not pre-fund your digital euro wallet to make payments; instantaneous funding will connect with your bank account.
- This design prevents large store-of-value holdings in digital euro wallets and supports financial stability.