The European Central Bank has been explaining to MEPs its decision to search for possible providers to develop a digital euro platform and infrastructure.
The central bank in January opened applications for vendors to provide components and related services for a potential digital euro in contracts that could total more than EUR1 billion.
Speaking before a European parliament committee, ECB board member Piero Cipollone, reassured MEPs that the central bank is not launching any of the development now, but instead is drawing up "framework agreements" that could be used in the coming years to develop the relevant components if the decision to launch the digital euro is taken.
"We need to be prepared for such an event," he says. "Our readiness would be compromised if we started searching for possible suppliers only after that decision is made. However, we are not tying our hands in any way by sourcing potential suppliers now. The agreements will be sufficiently flexible to accommodate the legislative deliberations or technological advances. And if we were to take the decision not to launch a digital euro, we would not sign any contracts."
Nonetheless, closer engagement with platform suppliers is deemed necessary to lay the groundwork for a green light on the project.
Says Cipollone: "This is particularly crucial for components that are not yet on the market, such as the offline digital euro functionality."
Acoordingly, the central bank has issued calls for applications to establish framework deals, but with one caveat: only legal entities with registered offices in the EU and controlled by such entities or EU nationals will be eligible to participate in the procurement process.
"To strengthen our autonomy, resilience and security, a digital euro would rely on a European infrastructure," explains Cipollone.
He says the ECB will publish the outcome of the public tender process on its website.