The EU is examining running a digital euro on a public blockchain such as Ethereum or Solana to enhance interoperability and resilience. Exploring public blockchains would mark a shift from private CBDC designs and could improve access, auditability, and integration with existing crypto infrastructure.
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EU explores public blockchains for the digital euro
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Ethereum and Solana are under consideration to balance openness and regulatory control.
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Public model aims to reduce reliance on US-pegged stablecoins and private CBDC architectures; stablecoins currently dominate 98% of market capitalization.
Digital euro public blockchain: EU examines Ethereum and Solana for a public-model digital euro—read how this could affect stability and sovereignty.
The EU is exploring Ethereum and Solana for its digital euro, marking a shift toward public blockchains over private models like China’s CBDC.
What is the digital euro on a public blockchain?
The digital euro on a public blockchain is a central bank–issued digital currency that would run on an open, permissionless ledger such as Ethereum or Solana. This design emphasizes transparency, broad accessibility, and potential interoperability with existing crypto services while maintaining central-bank monetary control.
How would the ECB run a digital euro on Ethereum or Solana?
ECB officials are reportedly evaluating public chains to host settlement layers or tokenized central-bank liabilities. Using Ethereum or Solana could allow the ECB to implement smart-contract wrappers for compliance rules, offline distribution channels, and programmable payments.
Supporters argue a public approach would improve auditability and third-party integration. Critics note privacy and scalability trade-offs; any final design would likely combine central-bank issuance with strict on-chain governance and regulatory controls.
Why consider public blockchains instead of private CBDC models?
Public blockchains offer open verification, broad access, and a large developer ecosystem. EU policymakers see potential to limit dependence on foreign stablecoins and private settlement rails while keeping monetary sovereignty.
Officials referenced concerns about US stablecoin expansion and noted that private CBDC deployments, like China’s, differ materially from public options. The stablecoin market concentration—dominated by US-dollar pegged tokens—was cited as a motivation to explore alternative architectures.
What trade-offs would a public-model digital euro face?
Key trade-offs include privacy versus transparency, throughput versus decentralization, and regulatory enforcement versus permissionless access. Any EU deployment would likely use layered solutions or permissioned overlays to address these trade-offs while preserving central-bank control over issuance and monetary policy.
Frequently Asked Questions
Will a digital euro on Ethereum be public and permissionless?
Not necessarily. While Ethereum is permissionless, the ECB could deploy a tokenized central-bank liability with on-chain controls or use a permissioned overlay to enforce regulatory rules while leveraging the public ecosystem.
How does this differ from China’s CBDC approach?
China’s CBDC uses a permissioned, centrally controlled ledger with restricted access. A public-model digital euro would emphasize open verification and broader integration with private-sector services, subject to EU regulatory guardrails.
Key Takeaways
- Public-chain exploration: EU officials are actively considering Ethereum and Solana as technical options.
- Policy drivers: Concerns about stablecoin dominance and financial sovereignty motivate the move.
- Design trade-offs: Any public-model digital euro will balance transparency, privacy, and regulatory compliance using layered solutions.
Conclusion
The EU’s examination of public blockchains such as Ethereum and Solana for a digital euro signals a potential shift from closed CBDC models toward more open, interoperable infrastructures. COINOTAG will monitor developments as technical pilots and policy decisions progress; stakeholders should prepare for layered designs that combine public-chain benefits with regulatory controls.
