The digital euro aims to be a new form of cash, but in electronic version: a public means of payment, accessible to all, safe, free, and usable across the euro area, both online and offline. It will not replace banknotes, but rather complement them, with the goal of preserving the role of central bank–issued money in a world that is using less and less physical cash.
The European Central Bank (ECB) launched the project in 2020 with an ambitious goal: to defend European monetary sovereignty in a context where digital payments are increasingly dominated by private players, almost always non-European. In this vision, the digital euro would allow citizens to continue accessing central bank money directly, also in digital form, and to do so through reliable infrastructures controlled by European public institutions.
The model designed by the ECB is intermediated: citizens will not hold an account directly with the ECB, but will use wallets provided by banks and other authorized Payment Service Providers (PSPs). These players will manage onboarding, security, and customer support, and may also offer additional services. The digital euro will be free for users, with basic functions designed for shopping, peer-to-peer payments, and transactions with public administrations. However, for reasons of financial stability, there will be limits on the balance that can be held. Offline transactions will be possible, but subject to restrictions and not fully anonymous.
All this has one goal: to create a public digital currency that does not destabilize the banking system, does not interfere with private credit, and remains compatible with the existing ecosystem. A cautious, institutional, technically sound solution.
But is this also the solution that citizens prefer? That is the central question of a SDA Bocconi research project comparing three possible scenarios for the introduction of a European digital currency. The research was presented at the ECB last spring and publicly discussed at a recent event hosted by SDA Bocconi.
Most respondents would use the digital euro, but two alternative solutions hypothesized in the study (Digital Cash and Euro Token, see below) received greater support among European citizens in terms of perceived utility, ease of use, trust, and adoption intent.
This challenge matters, because the digital euro is a test case for European monetary sovereignty in the digital age. The research shows that the ECB’s current model risks not being fully convincing for users. But it also points to a different path, more ambitious and in tune with people’s needs.
The research was designed to understand which model of digital euro could truly work for European citizens. The project aims to offer a new form of central bank money, accessible in digital format, to respond to the decline of cash and the growing spread of private money (such as stablecoins). In the ECB’s vision, the digital euro is distributed through intermediaries (banks and PSPs), comes with usage and holding limits, and is neither programmable nor integrated with the crypto ecosystem.
But is this setup really capable of generating trust and adoption? And what alternatives could be envisioned? The study starts from these questions:
Thanks to a partnership with Revolut, the SDA Bocconi research team presented three alternative scenarios to more than 2.3 million users in 27 European countries, collecting 17,000 valid responses. The scenarios were:
Each participant was randomly assigned to one scenario to measure reactions neutrally. The survey analyzed dimensions such as perceived utility, ease of use, compatibility with habits, trust, perceived risks, and adoption intent.
Digital Cash and Euro Token are preferred over the digital euro across all indicators: from ease of use to adoption intent, from trust to compatibility with payment habits. The digital euro has the highest rejection rate: 24% of respondents said they would not use it. The Euro Token scores highest as a solution for non-routine uses (e.g., peer-to-peer transactions, crypto integration). Digital Cash is perceived as the most suitable replacement for cash, thanks to its simplicity, zero cost, and public control. In all cases, the two most relevant factors for adoption are perceived utility and compatibility with habits.
The findings suggest that the success of the digital euro cannot rely solely on technical robustness; it must be built around the value it creates for citizens.
A digital euro that is too similar to existing tools risks irrelevance. To have an impact, it needs to be simpler and more accessible, more public (less dependent on private actors), and more integrated into the contemporary digital ecosystem.
A key question concerns the involvement of banks, whose role in the alternative scenarios is reduced to that of providers of additional and premium services linked to the digital currency.
Stefano Caselli, Giampaolo Gabbi, Leonardo Maria De Rossi, Nico Abbatemarco, Michele Russo, Simone Moretti. The Digital Euro. The new frontier of European money.
Read also:
Caselli, De Rossi, Gabbi, Moretti – The Digital Euro: A challenge European leaders can’t afford to ignore.
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