ECB’s Cipollone: Digital Euro Pilot to Grant Europe Long-Awaited Payment Sovereignty

European Central Bank Executive Board member Piero Cipollone has emphasized that the upcoming digital euro pilot scheduled for next year holds the transformative potential to grant the eurozone absolute sovereignty over a payments infrastructure that currently remains heavily reliant on external, non-European third parties.

In a comprehensive interview with Italy’s Milano Finance published by the central bank, Cipollone detailed the strategic vulnerabilities facing the European Union as a result of its critical dependence on foreign entities for essential financial services. Although he refrained from naming specific third-party providers, his remarks underscored a growing institutional consensus within Frankfurt that Europe must secure greater autonomy over the digital rails that process its daily commerce.

According to Cipollone, recent global disruptions have exposed structural weaknesses across multiple critical sectors, forcing policymakers to reconsider the wisdom of outsourcing vital infrastructure. In recent years, Europe has learned harsh lessons regarding essential services, discovering through energy crises and ongoing defense challenges that relying exclusively on external third parties creates unacceptable strategic risks. The same vulnerability, he warned, applies directly to the realm of payments.

The upcoming pilot program represents a major milestone in the European Central Bank’s preparation phase, utilizing real transactions conducted strictly by staff members of the ECB and national central banks. The initiative is gathering substantial momentum through broad industry collaboration. With 36 market operators already involved in preparations—including seven prominent financial entities based in Italy—the central bank is actively reaching out to invite e-commerce and mobile-commerce operators to participate in testing the ecosystem.

The smooth functioning of payment systems is one of the foundational responsibilities entrusted to the European Central Bank. If the currency bloc remains critically dependent on third parties, ensuring that this smooth functioning continues uninterrupted under all geopolitical and economic conditions becomes an increasingly difficult challenge.

At the same time, Cipollone was careful to clarify that achieving strategic sovereignty does not equate to erecting protectionist barriers or completely shutting third parties out of the European market. Instead, true sovereignty means possessing the power of choice and the absolute assurance that, when it comes to an essential service as critical as payments, Europe possesses the independent capacity to rely on its own internal strength.

This theme of strategic vulnerability is not new to the ECB’s public discourse. Earlier this year, during a public lecture delivered in Latvia, Cipollone explicitly warned that Europe’s heavy reliance on non-European payment providers constitutes a major strategic risk. He pointed out the striking reality that roughly two-thirds of all euro-area card transactions are governed by non-European corporations. In his view, the introduction of a digital euro could substantially mitigate this dependence, offering merchants and consumers a secure, state-backed, and European-controlled payment infrastructure.

Despite the steady progress of the technical preparations and pilot planning, the ultimate decision to issue a digital euro still rests firmly with the political and institutional framework of the European Union. Under the current legislative roadmap, the ECB Governing Council can only make a formal decision regarding the issuance of the digital currency after the ongoing legislative negotiations in Brussels reach a definitive conclusion.

Expressing optimism regarding the legislative timeline, Cipollone told Milano Finance that the central bank hopes the necessary regulation will be formally adopted by the end of the year. Such a milestone would clear the path for the ECB’s Governing Council to adopt a formal decision on whether and when to issue the digital euro to the public.