Digital Euro: ECB Targets 2027 Pilot Launch as Lagarde Succession Looms
📋 En bref (TL;DR)
- Clear timeline: ECB targets a 12-month pilot starting in the second half of 2027, with service provider selection in early 2026
- Call for applications: European payment service providers (PSPs) can apply in Q1 2026 to participate in the pilot
- 2029 target: Commercial launch of the digital euro planned for 2029, pending European legislation adoption
- Lagarde succession: The ECB president may leave before late 2027, putting the project’s future at stake
- Sovereignty protection: The digital euro aims to reduce dependence on American payment networks (Visa, Mastercard)
- Stablecoin regulation: The project is part of a broader strategy to regulate digital currencies in Europe
The digital euro has reached a decisive milestone. On Wednesday, February 18, 2026, Piero Cipollone, a member of the European Central Bank’s Executive Board, unveiled the project’s concrete timeline during a meeting with the Italian Banking Association. The ECB plans to launch a call for applications from payment service providers in Q1 2026, ahead of a 12-month pilot scheduled for the second half of 2027.
This ambitious timeline comes amid particular circumstances: according to the Financial Times, Christine Lagarde is considering leaving her position before the end of her term in October 2027. A succession that could redefine the Frankfurt institution’s priorities on digital currencies.
A Clear Timeline for the Digital Euro
The Pilot Phase: 12 Months of Real-World Testing
The Eurosystem published details of its pilot program on November 28, 2025. This real-world test will unfold in four distinct phases:
Assessment phase: Publication of the call for applications, evaluation of submissions, and notification of results to selected providers.
Preparation phase: Transmission of updated documentation to preselected providers, confirmation of their interest, and signing of participation agreements.
Implementation phase: Collaboration between providers and the Eurosystem to refine the operating system, conduct tests, onboard end users, and collect their feedback.
Execution phase: Providers support pilot deployment in close cooperation with the Eurosystem, including user onboarding and operational transaction processing.
Who Can Participate in the Pilot?
The pilot will only involve Eurosystem staff, selected merchants who already provide daily services at ECB and national central bank premises in the eurozone (cafeterias, restaurants), and certain e-commerce sites.
Participants will be able to make person-to-person payments (online and offline) and person-to-business payments (at physical points of sale and in e-commerce). These digital transactions will replicate the digital euro’s technical design but will not be legal tender.
Payment service providers will be selected based on their capabilities and predefined criteria. The selected pool must ensure representative coverage of the eurozone market in terms of size, geographic coverage, and commercial reach.
Christine Lagarde’s Succession in Question
An Early Departure That’s Shaking Frankfurt
According to a source close to her thinking cited by the Financial Times, Christine Lagarde is considering leaving the ECB presidency before the end of her eight-year term, scheduled for October 2027. The goal would be to allow French President Emmanuel Macron and German Chancellor Friedrich Merz to agree on a successor before the French presidential election in April 2027.
The ECB spokesperson, however, tempered this information: « President Lagarde is fully focused on her mission and has made no decision regarding the end of her term. »
Who Are the Potential Successors?
Economists surveyed by the Financial Times in December identify several serious candidates:
Pablo Hernández de Cos, former Governor of the Bank of Spain, has described crypto-assets and stablecoins as risks to financial stability requiring strict regulation and supervision.
Klaas Knot, Governor of the Dutch central bank, has called for a robust global regulatory framework for crypto-assets and stablecoins.
Joachim Nagel, President of the Bundesbank, has called Bitcoin a « digital tulip » and warned against using it as a reserve asset. He links the digital euro to safeguarding European monetary and financial sovereignty.
Isabel Schnabel, member of the ECB’s Executive Board, has described Bitcoin as « a speculative asset with no recognizable fundamental value. »
Why the Digital Euro Is Strategic for Europe
Reducing Dependence on American Giants
Piero Cipollone was clear: the digital euro aims to protect European domestic payment systems like Italy’s Bancomat card network or Spain’s peer-to-peer payment system Bizum.
« Banks could lose their role in payments not only because of stablecoins but also because of other private solutions, » he explained, pointing to Europe’s heavy reliance on international card networks like Visa and Mastercard.
To maintain the competitiveness of local systems, the ECB plans strategic fee capping: commissions on the digital euro network will be lower than those on international networks (the most expensive) but higher than those on domestic payment systems (the least expensive).
A Tense Geopolitical Context
The digital euro is part of what ECB officials call a « weaponised » world. In a context of trade tensions and global economic fragmentation, payment system autonomy becomes a matter of sovereignty.
The project also aims to anticipate the rise of private stablecoins, most of which are denominated in US dollars. Under the MiCA regulation, which came into force in 2024, Europe now has a framework to regulate these digital assets, but the ECB believes a central bank digital currency remains essential.
The Regulatory Framework Under Construction
Legislation Expected in 2026
The final decision to issue a digital euro will only be made after the corresponding European legislation is adopted. According to Cipollone, European co-legislators should adopt the digital euro regulation during 2026.
This legislative adoption is the essential prerequisite for launching the pilot. The Eurosystem is targeting an initial potential digital euro issuance in 2029, provided the legislative process stays on track.
Innovation in the Regulatory Sandbox
Alongside the digital euro project, Europe is experimenting with innovative approaches through its « blockchain regulatory sandbox. » This mechanism allows companies to test blockchain-based solutions in a controlled environment while benefiting from direct dialogue with regulators.
This approach illustrates Europe’s desire to strike a balance between innovation and consumer protection, a major challenge in the digital currency ecosystem.
What Does This Mean for European Citizens?
A Complement to Cash, Not a Replacement
The ECB insists: the digital euro will not replace cash but complement it. It will offer a universal digital payment option, accessible to all eurozone citizens, including those without a bank account.
For European citizens, this potentially means:
• Free or very low-cost instant payments between individuals
• An alternative to private payment apps (PayPal, Apple Pay, etc.)
• A payment solution that works even offline
• Better personal data protection than private solutions
The Role of European Banks
European banks will be at the heart of digital euro distribution. They will serve as intermediaries between the ECB and end users, thus maintaining their central role in the financial system.
For institutions participating in the pilot, this phase will offer a competitive advantage: practical experience with integration, settlement, and liquidity management, as well as better visibility into future infrastructure and compliance costs.
Key Takeaways
The digital euro is entering a concrete phase with a now-established timeline: service provider selection in early 2026, 12-month pilot in the second half of 2027, potential commercial launch in 2029. The project aims to strengthen European sovereignty in digital payments, facing the dominance of American networks and the rise of private stablecoins.
Christine Lagarde’s possible early succession adds political uncertainty to this technical timeline. However, all identified potential successors share a cautious view of crypto-assets and support for the digital euro project, suggesting likely strategic continuity.
For European citizens and businesses, the digital euro represents a future sovereign payment option, complementary to cash and existing private solutions. The coming months will be crucial in observing whether the ECB’s ambitious timeline materializes.
📚 Glossary
- CBDC (Central Bank Digital Currency): Digital form of fiat currency issued and guaranteed by a central bank. Unlike decentralized cryptocurrencies, a CBDC is centralized and is legal tender.
- PSP (Payment Service Provider): A company licensed to provide payment services to consumers and merchants. In Europe, PSPs must be licensed under the Payment Services Directive (PSD2).
- Stablecoin: A cryptocurrency whose value is pegged to a stable asset, typically a fiat currency like the dollar or euro. Stablecoins aim to combine the advantages of blockchain with the stability of traditional currencies.
- MiCA (Markets in Crypto-Assets): European regulation that came into force in 2024, establishing a harmonized legal framework for crypto-assets in the European Union, including stablecoins and crypto service providers.
- Blockchain: Distributed ledger technology that enables transactions to be recorded transparently, securely, and immutably without a centralized intermediary. It forms the technical foundation of cryptocurrencies.
- Eurosystem: The entity formed by the European Central Bank and the national central banks of eurozone countries. It is responsible for monetary policy and price stability in the eurozone.
Frequently Asked Questions
When will the digital euro be available to the general public?
The Eurosystem is targeting an initial potential digital euro issuance in 2029. Before that, a 12-month pilot will take place in the second half of 2027 with a limited group of participants.
Will the digital euro replace cash?
No, the ECB has clearly stated that the digital euro will complement cash, not replace it. Citizens will be able to continue using cash as a means of payment.
What’s the difference between the digital euro and stablecoins?
The digital euro will be issued and guaranteed by the ECB with legal tender status, while stablecoins are private assets issued by companies. The digital euro will offer the guarantees of a central bank currency.
Why might Christine Lagarde leave before the end of her term?
According to the Financial Times, she is considering an early departure to allow Emmanuel Macron and Friedrich Merz to agree on a successor before the French presidential election in April 2027.
Will European banks participate in the pilot?
European payment service providers, including European banks, can apply during the call for expression of interest scheduled for Q1 2026. Selection will be based on capacity criteria and market representativeness.
📰 Sources
This article is based on the following sources:
- ECB To Launch Payment Provider Selection For Digital Euro – Cointelegraph, February 18, 2026
- Eurosystem to invite payment service providers to participate in digital euro pilot – ECB, November 28, 2025
- Lagarde May Leave ECB Early as Digital Euro Enters Key Phase – Cointelegraph, February 2026
- Christine Lagarde considers early exit from ECB – Financial Times, February 2026
How to cite this article: Fibo Crypto. (2026). Digital Euro: ECB Targets 2027 Pilot Launch as Lagarde Succession Looms. Retrieved February 18, 2026 from https://fibo-crypto.fr
