The euro zone’s monetary authority, Eurosystem, is seeking to recruit financial firms willing to develop front-end solutions for the digital euro. The plan is to conduct a “prototyping exercise” this year to test back-end transactions developed by the regulator.
Eurosystem selects front-end vendor for digital euro project
In an ongoing investigation into the possible issuance of a digital euro currency, the Eurosystem intends to conduct an experiment that, among other goals, will test end-to-end transactions with the European Central Bank (CBDC), the European Central Bank (CBDC). European Central Bank) announced before the weekend.
The agency, which consists of the European Central Bank and the central banks of euro zone member states, is looking for parties interested in providing front-end prototypes for trials. Transactions will start with its front-end prototype and will be processed through interfaces to the back-end, both developed by Eurosystem.
Payment service providers, banks and other related companies have been invited to participate as front-end providers of technology solutions aimed at facilitating payments in digital euros. Their application deadline is May 20. Prototyping work is scheduled to begin in August and may continue through the first quarter of 2023.
The announcement details that the goal is to gather a group of front-end suppliers with whom Eurosystems will work to develop user-facing prototypes. The authorities will invite potential participants to explain the use cases of their prototypes. A limited number of suppliers will then be selected, up to five European system representations.
They will contract with the euro area financial authorities and are expected to organize prototype development. Throughout the process, suppliers will be able to share their feedback on the Eurosystem interface and backend infrastructure, including making specific data requirements to support specific business models.
In October last year, the project to launch a digital version of the European common currency entered the investigation phase. In February, news broke that the European Commission plans to introduce a bill early next year to lay the legal foundation for the currency. Fabio Panetta, a member of the ECB’s executive board, recently said that the bank is focusing its efforts on a digital euro.
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