there are no plans to reuse these prototypes in the subsequent phases of the digital euro project. we have run a public call for expressions of interest for joining the prototyping exercise. all interested parties had to fulfil several " essential capabilities " that were outlined in the call, e. g. data protection / privacy compliance. we assessed which providers best matched the " specific capabilities " required for specific use cases. see ecb ( 2022 ), " ecb selects external companies for joint prototyping of user interfaces for a digital euro ", mip news, 16 september. 13 users will have the option to choose whether the conversion of commercial bank money or cash into digital euro, and vice versa, should take place manually or automatically. for the automatic option, we are investigating a waterfall functionality that would allow users to make or receive payments in digital euro above the holding limit by linking a digital euro account to a commercial bank account. when receiving a payment, this would allow automated conversion of retail cbdc in excess of a holding threshold into a bank deposit held in a linked commercial bank account chosen by the end user. similarly, a reverse waterfall would ensure that end users can make a payment even if the amount exceeds their current digital euro funds. additional liquidity would be pulled from the linked commercial bank account and the transaction would be completed in digital euro at its full value. 14 the eurosystem's sepa migration impact assessment noted that, in the context of the growing technical complexity of payment services in europe, one of the lessons that can be learnt from the sepa project and the implementation of the revised payment services directive ( psd2 ) is that technical standardisation and development of the scheme would ideally be completed before legislation to mandate its use is introduced. 15 for instance, the eurosystem might only be responsible for issuing the digital money, without providing the settlement infrastructure or intervening in distribution – the " issuance model ". alternatively, in an open access model, the eurosystem would only provide the settlement infrastructure and set access rules ; every entity that fulfils these 6 / 7 bis - central bankers'speeches rules could then use the infrastructure in their own way. while they give the market room to innovate, these two models may not achieve widespread distribution to end users or sufficient interoperability, which would hamper the end - user experience and financial inclusion. one could also imagine an alternative distribution model in which the eurosystem would provide the

as the scheme is being developed. conclusion let me conclude. a well - designed digital euro would bring benefits for everyone. it would provide a payments solution for anyone needing to make or receive a payment. it would ensure that a standardised infrastructure is available to everyone. and it would serve as a strong foundation for intermediaries to offer payment services throughout the euro area, thereby fostering competition and innovation. cooperation between the public and private sectors is crucial to make the digital euro a reality. the eurosystem and the intermediaries involved will have a key role to play, drawing on their respective expertise. successful cooperation will require a pricing strategy that provides adequate economic incentives to foster the adoption of the digital euro. we are currently analysing a possible compensation model for the digital euro, a topic that is also relevant for the european commission. i stand ready to discuss this with you in the coming months, as well as other important aspects of the digital euro that we are currently investigating. 4 / 7 bis - central bankers'speeches i now look forward to your questions. 1 panetta, f. ( 2022 ), " a digital euro that serves the needs of the public : striking the right balance ", introductory statement at the committee on economic and monetary affairs of the european parliament, brussels, 30 march. 2 panetta, f. ( 2022 ), " the digital euro and the evolution of the financial system ", introductory statement at the committee on economic and monetary affairs of the european parliament, brussels, 15 june. 3 ecb ( 2022 ), " progress on the investigation phase of a digital euro ", september. the eurosystem first establishes staff positions on the major design issues and policyrelevant aspects of a digital euro. these are then discussed with external stakeholders before the eurosystem high - level taskforce makes a final assessment. the ecb's governing council then approves the design options. further information on the project governance and the key milestones and project timeline is also available on the ecb's website. 4 for other transactions, the baseline will be to provide people with a level of privacy equal to that of current private digital solutions. 5 quantitative limits on the holdings of individual users would limit the individual take - up or the speed of deposit conversion. remuneration - based tools could be calibrated to make large digital euro holdings above a certain threshold unattractive compared with other highly liquid and low - risk assets. 6