The selected participants include major financial institutions and payment firms such as Deutsche Bank, UniCredit, Revolut, Adyen, SumUp and Worldline. They were chosen from more than 50 applications submitted across the euro area. Several banks that had previously expressed strong opposition to the project are now included in the pilot.
The testing programme will run for 12 months, beginning in the second half of 2027. Its purpose is to evaluate the full technical infrastructure, operational procedures and user experience before a possible official launch in 2029. During this phase, the digital euro will be tested in real-world payment scenarios. Employees of the ECB and the 19 national central banks in the eurozone will act as users, making person-to-person (P2P) transfers and payments in shops, restaurants, cafés and on e-commerce platforms.
The system will support both online and offline payments, one of the key features the ECB believes could make the digital euro function more like physical cash. Although the beta version will not yet have legal tender status, its design will closely follow the regulatory framework currently being developed by the European Union.
The ECB has previously warned that the dominance of US dollar-backed stablecoins and international payment networks such as Visa, Mastercard and PayPal in Europe’s digital transactions could leave the EU dependent on foreign financial infrastructure. According to Reuters, this concern has become one of the main drivers behind the digital euro project. Only a few days before the ECB announced the list of pilot participants, the European Parliament voted to enter the final round of negotiations on the digital euro’s legal framework.
If the legislative process is completed this year, the ECB Governing Council will have the legal foundation required to decide whether to issue the digital euro in 2029. The Financial Times reported that banks including Deutsche Bank, DZ Bank and Groupe BPCE had previously raised concerns that the digital euro could cause deposits to move out of the commercial banking system, increasing funding costs and reducing profitability.
However, their decision to apply for the pilot suggests that Europe’s financial sector is moving from opposition towards preparation and adaptation in case the ECB’s digital currency becomes a reality. Despite the project’s accelerating progress, the digital euro remains one of the ECB’s most controversial initiatives.
Privacy organisations are concerned that a central bank digital currency could allow authorities to monitor citizens’ transactions or restrict access to funds under certain circumstances.
To address these concerns, the ECB has stated that the digital euro will not replace cash. It will support offline payments with a higher degree of privacy than online transactions and will not pay interest, reducing competition with bank deposits. The ECB is also expected to introduce a holding limit, previously suggested at around 3,000 euros per person, to prevent large-scale withdrawals from the commercial banking system.
CBDCs are increasingly becoming a dividing line between the opposing approaches taken by the United States and Europe in the race to control digital monetary infrastructure. Under President Donald Trump, Washington has placed greater emphasis on the private sector, supporting stablecoins as a way to extend the dominance of the US dollar across the global payment system.
At the same time, federal legislation that came into force last month continues to prohibit the Federal Reserve from issuing a digital US dollar until the end of 2030, effectively closing the door on a US CBDC in the near future. For Europe, however, this development is viewed as a warning. The ECB and the European Stability Mechanism (ESM) have repeatedly warned that US support for stablecoins could accelerate digital dollarisation, with capital, liquidity and euro-denominated payments gradually shifting towards digital assets pegged to the US dollar.
Such a trend could weaken the euro’s international role while making the European Union’s payment infrastructure increasingly dependent on US companies and financial ecosystems.
conclusion: The pilot marks a major shift from theoretical planning to real-world testing of the digital euro. Its success will depend on whether the ECB can strengthen Europe’s payment independence without undermining bank deposits or user privacy.
