The decision by the European Commission and the European Parliament’s Committee on Economic and Monetary Affairs to approve the introduction of the digital euro in the Eurozone at the request of the European Central Bank. MEP Kostas Mavridis explained on the Alpha News program that this is the most significant economic initiative in the Eurozone in recent years and emphasized that its use will not eliminate cash as we know it, neither in the form of banknotes nor coins.

But what is the digital euro, and how will it work?

“The European Central Bank’s goal is to provide those who conduct transactions today with yet another tool. It will come in two forms: either like having a bank account today where you hold money—instead of physical cash, it will be in electronic form. One euro will be equal to one digital euro. The other way is similar to how I have physical cash in my pocket and go to the supermarket; in the same way, someone will be able to make a transaction, not only through a bank account but also through offline transactions. “I won’t need to be linked to a bank account.”

The MEP pointed out that, especially since the coronavirus pandemic, there has been a sharp increase in credit card use, even though there is currently no common, pan-European card.

“Such cards exist in some member states, but they are all American. So the goal is strategic autonomy—not only in defense matters, but also in the economy. I’ll give you just two examples: all the cards are American, while our member states and companies are rated by American agencies. The goal is to reduce this dependence.”

Mr. Mavridis noted that the digital euro meets the significant needs observed for financial transactions outside the banking system—needs that cryptocurrencies have brought into our lives.

“The sole issuer will be the European Central Bank, and that is what divides us. We want every central bank—to the extent of its knowledge—to also be involved in the digital euro. There should be no possibility of interference, and the digital euro must ensure privacy.”

The MEP said that “the ball is already rolling,” and it is estimated that the first pilot programs for the digital euro will be implemented by 2029.