ECB selects COTI Network for digital euro testing

The European Central Bank (ECB) is preparing another round of exploration for launching a digital euro. COTI Foundation will be part of the effort, testing the potential for a centralized digital currency. 

The European Central Bank (ECB) has selected COTI Network as an exploration sandbox for its digital euro project. The ECB selected several Pioneer Partners from the private sector to work out potential solutions for the digital euro. 

ECB seeks out COTI Network for its digital euro program

COTI Network was singled out for having experience with central bank digital currencies (CBDCs), after an exploratory program with the Central Bank of Israel. COTI represents private crypto entities, as the ECB tapped multiple companies to explore all stages of deploying a digital euro. 

“Being invited to work with the ECB on such a consequential project is humbling, and a testament to the expertise and hard work of the COTI team. Privacy is a vital component for the future of Web3, ensuring users’ security and organizations’ compliance, and the same benefits apply to CBDCs,” said Shahaf Bar-Geffen, COTI co-founder and CEO.

COTI Network offers a lightweight privacy tool for Web3 payments. The network is one of the few crypto representatives in the ECB’s consideration. The bank gathered a total of 70 private business entities, among them KPMG and Erste Group Bank AG. The bank aims to explore digital solutions from the point of view of fintech, banks, and on-chain startups.

The ECB has held multiple exploratory sessions for digital currencies, reversing its initial skeptical stance. The bank initially considered digital assets as a threat to its liquidity controls, but later conceded. The Euro Area remains one of the most regulated regions for crypto usage, leading to wider adoption of legal use cases. 

The ECB will let all Pioneer Project entities work on solutions by the end of 2025, and present their findings in a report in early 2026. The ECB will look for complete payment gateways for the digital euro, including in e-commerce. The potential to pay online may bypass the banking system, offering a more streamlined way of sending and receiving value. 

COTI offers privacy to digital Euro payments

COTI Network will explore the potential of using the digital euro in a way that verifies identities but offers a layer of privacy. In general, privacy coins are viewed with skepticism and may face further limitations from EU authorities. However, the approach of COTI Network allows full authenticity verification without sharing sensitive information. 

COTI has already created tools for trustless international money transfers, offering swaps between different currencies. 

The ECB research does not focus on end clients, but on the infrastructure of online merchants, banks, fintech and other payment service providers. The end goal is to achieve safe payments across the Euro Area, with scale and liquidity sufficient for a $15T economy.

Currently, tokenized euro is only used informally, lagging behind the dollar-based stablecoins. The ECB aims to use faster, scalable networks, creating a secondary payment market outside bank transfers.

KEY Difference Wire helps crypto brands break through and dominate headlines fast