The European Central Bank (ECB) and European Commission are beavering away at the technical details for a digital euro – but among political decision-makers it appears hard to muster much enthusiasm for the putative central bank digital currency (CBDC).

New laws to underpin the CBDC propose a raft of answers to questions on privacy, offline use and distribution, and now seem set to be published next week – but, if the technical issues are ripe, the political ones aren’t.

Perhaps understandably, the bill focuses on what the CBDC should not do – banning holdings from getting too large, or being paid interest, in an explicit bid to stop the CBDC competing with savings or investment.

What’s missing, politicians now complain, is the positive case for what the CBDC should be there to do – which may be responsible for some of the late-stage hiccups in producing the formal legislative proposal.

At a meeting last week, euro finance ministers discussed “the importance of developing a compelling and clear narrative regarding what would be the added value of this development and the difference that it would make to the lives of the citizens of Europe and to the commercial activity of businesses,” said Ireland’s Paschal Donohoe, who chaired their talks.

Donohoe has been broadly positive about the project, saying in a March OpEd that issuance was inevitably needed to protect the euro’s value and sovereignty from foreign rivals. But ministers have also stressed the project must command public support – and now, it seems, want reminding about why the project should go ahead in the first place....

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