The Council of the European Union has recently officially expressed its support for the digital euro design blueprint proposed by the European Central Bank (ECB) and agreed that the digital euro will simultaneously launch both an 'online version' and an 'offline version focused on privacy', which will soon enter the legislative review stage in the EU.
Digital euro online and offline versions are being advanced in parallel, expanding the flexibility of digital payments
According to the latest document from the Council of the European Union, the Council has clearly endorsed the overall design direction of the ECB regarding the digital euro and aligns with the central bank's position, meaning that the digital euro will plan for both online and offline versions, launching them simultaneously.
This means that if the digital euro is officially launched in the future, the public will be able to use it not only in online environments but also in offline transactions, expanding the flexibility of digital payments. In the future, after the legal framework is passed, it will be up to the ECB to decide whether to issue it. Currently, the ECB indicates that the digital euro may be activated before 2029.
The central bank's design is complete, and legislative decisions return to the political level.
ECB President Christine Lagarde also pointed out in related explanations that the central bank has completed the design at the institutional and technical levels, and the next key is not with the ECB but with the political and legislative processes of the European Union.
She stated that the subsequent discussions will continue in the European Council, and the European Parliament will assess whether the proposals put forward by the European Commission are sufficiently complete, whether they need amendments, and whether they should formally be transformed into legally binding EU legislation.
Offline design focus, privacy-oriented quasi-cash mechanism.
In terms of institutional positioning, offline digital euros are set as a digital payment tool closer to cash, with the core goal of reducing the possibility of transactions being tracked and analyzed. The document points out that traditional digital payment systems often leave transaction records available for analysis, while the design of offline digital euros attempts to prevent third parties from linking multiple transactions to the same user, thereby enhancing transaction privacy.
Furthermore, offline transaction data will not be returned to the central system but will only be retained on the devices of both parties. In practice, offline digital euros will be transacted through certified devices with built-in security components, where digital euros stored in the device and signed by the central bank are directly transferred between both parties’ devices, primarily used in face-to-face payment scenarios.
Offline digital euros still cannot be completely equated with cash; technological limitations emerge.
However, the document also admits that in a digital environment, requiring both parties to be physically close is not a condition that can be reliably enforced.
The document points out the so-called risk of ‘Relay Attack,’ explaining that attackers may set up proxy devices near both the payment and receiving ends, extending the originally limited-range communication signals over the network, allowing transactions designed for face-to-face interaction to actually occur over a distance.
In this regard, the European Council candidly acknowledges that the preventive measures currently available are quite limited. In the digital currency system, it is challenging to consistently require transactions to be conducted ‘face-to-face,’ nor can it fully replicate the transaction characteristics of ‘requiring physical contact’ like physical cash.
The document also explains that although offline digital euros are marketed with a high privacy design, they are still not equivalent to completely anonymous physical cash; relevant private keys and assets must be stored in the secure components of certified mobile devices or smart cards. This means that offline digital euros are essentially still a type of digital payment tool regulated and managed by the system.
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This article about the EU's decision on the dual-track design of the digital euro, with online and offline versions being advanced simultaneously, first appeared on Chain News ABMedia.
