The European Commission (EC) announced that it plans to propose a bill as legal foundations for a digital euro sometime in 2023, reported by Politico.

The EC’s finance chief Mairead McGuinness, speaking at a fintech conference by Afore Consulting, said that the goal of the EC is to table legislation regarding a central bank digital currency (CDBC) for euro in early 2023.

The rise of government-backed digital currencies came after multiple private algorithmic stablecoins have been introduced to the market over the past few years, mostly linked to USD, and now governments, citing privacy and personal data malpractice concerns, plan to retake the stronghold private corporations have on stablecoins.

The first CDBC of any currency was officially debuted during Winter Olympics hosted in Beijing, where the Chinese government is piloting its eCNY for foreign visitors and athletes to use within the Olympic Village.

While the U.S. had conducted research on the viability of a government-backed USD, it lags behind on any bills or legislations that could propel a launch of CDBC in the near future. On the other hand, Christine Lagarde, head of the European Central Bank (ECB), stressed the need for the EU to push out a version of a digital Euro.

In an interview with Redaktionsnetzwerk Deutschland, Lagarde explains why a digital euro is crucial for the EU:

“…there are private providers trying to establish cryptocurrencies. We need to have an answer to that. We cannot allow users’ personal data to be monetised. Moreover, the technology used in private digital currencies also creates new, alarming opportunities, e.g. for terrorism financing and money laundering. This is why creating a digital euro must be a public project. It also strengthens Europe’s sovereignty.”

In addition, Lagarde also points out that the EU has been heavily reliant on foreign digital payment systems, such as Visa, Mastercard, and in a broader sense, a high level of dependence on imports of oil, gas, and microchips. With this comes higher costs of goods and services. Thus, to reduce the costs of goods and services sold to citizens in the EU, it must regain autonomy, and the digital euro will facilitate such cause.