Nicosia, Cyprus. Debate over the future of cash and the introduction of a digital euro has intensified following comments by European Central Bank chief Christine Lagarde and a series of measures expanding digital payment requirements across Europe.
Lagarde said in a 2023 prank call that the digital euro could involve “limited amount of control,” while the ECB and the Central Bank of Cyprus have said any digital currency would complement rather than replace cash.
Lagarde prank call draws attention
In March 2023, Lagarde took part in a prank call posted online in which a prankster impersonating Ukraine President Volodymyr Zelenskiy.
During the conversation, Lagarde said the ECB was considering whether for very small amounts, around €300 or €400, there could be a mechanism with zero control, but added that this could be dangerous. She referred to a previous terrorist attack in France believed to have been financed by rechargeable and anonymous credit cards.
Cash restrictions highlighted in Cyprus and Greece
The issue was revisited after the Cyprus Mail published an article last week by Cyprus-based lawyer Andreas Shialaros, who wrote that from July 1 cash can no longer be used to pay rent, a measure presented as targeting tax evasion.
Shialaros said the measure should not be viewed in isolation, citing Greece, where an omnibus bill before parliament requires every transaction of €500 or more to be settled electronically. He noted that the total value of the transaction matters rather than individual receipts, to prevent bills from being split into smaller cash payments.
EU-wide limits and digital identity rollout
At EU level, the new Anti-Money-Laundering Regulation sets a €10,000 cap on cash business transactions across the bloc from July 10, 2027, while allowing member states to impose lower national limits.
At the same time, the European Digital Identity Wallet is moving from large-scale pilots into deployment.
ECB and Central Bank of Cyprus position
In follow-up commentary, Shialaros explained what the digital euro is, what it is not, and what it means for the average person.
The ECB has said it is aware of concerns about individual liberty and anonymity and maintains that the digital euro would not replace cash. On its website, the ECB says, “The ECB and the Eurosystem would not be able to identify who you are or what you are buying from the payment data we get.”
The ECB says it aims to be ready for a potential first issuance of the digital euro in 2029, provided the necessary EU legislation is adopted in 2026.
The Central Bank of Cyprus has also said it is examining how to make the currency digital, adding that changes in payment preferences make it important for the currency to evolve in parallel and that it would complement, not replace, cash.
