Bulgaria will become the 21st member of the eurozone – or Schengen monetary area – on Thursday, despite deep scepticism from some in the country amid fears of inflation.

The Southeast European country has been a member of the European Union since 2007, but formally met the eurozone’s entry criteria only in January 2025, paving the way for its currency ascension after a long delay.

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The move will increase the number of Europeans using the euro to 356 million people, and geographically extend the single currency into the Black Sea area for the first time, despite ongoing geopolitical tensions.

However, there is concern among some Bulgarians that adopting the euro could bring on an economic crisis in a country considered the poorest in the EU.

There is widespread mistrust in the government. Earlier this December, the minority pro-EU coalition leading the country was compelled to resign after mass protests erupted against a proposed budget plan that sought to introduce higher taxes. Despite the plan being withdrawn, the protests grew to encompass demands for broader governmental change.

Here’s what we know about why the move to adopt the euro in Bulgaria has become so controversial:

Protesters hold placards depicting Bulgarian politician Delyan Peevski, accused of corruption, during an antigovernment protest in Sofia on December 1, 2025. Tens of thousands of people protested on December 29, widening an anticorruption movement sweeping the country as it prepares to adopt the euro [Nikolay Doychinov/AFP]

What’s happening?

Bulgaria, a country of 6.7 million people, joined the EU in 2007 and has since been pushing to join the eurozone.

However, political instability has slowed the progress of reforms required for the country to be accepted into the zone, as government after government has grappled with allegations of corruption.

Under the 1992 Maastricht Treaty, EU member states must meet five criteria before they can join the eurozone. These set fixed targets for inflation, budget deficit, debt-to-GDP (gross domestic product) ratio, exchange rate stability and long-term interest rates. Monetary policy is centrally controlled by the European Central Bank (ECB).

The EU finally greenlit Bulgaria’s ambitions in January 2025, after determining that it had now met the economic and legislative criteria to join the eurozone. In June and July, EU institutions – the European Council, the Financial Affairs Council, both in Brussels, and the European Parliament in Strasbourg – gave their approval for the accession.

How does joining the eurozone work?

The EU has set a conversion rate of 1 euro to 1.95583 Bulgarian lev (BGN) under the European Exchange Rate Mechanism, which Bulgaria joined in 2020 as a condition for adopting the euro. The move formally pegged the lev to the euro. However, the lev had informally already been pegged to the euro since 1999 when Germany switched to the currency. This is because Bulgaria had tied its currency to the German mark in 1997 in a bid to stabilise its economy and rein in soaring inflation. Therefore, many analysts say, the formal adoption of the single currency may not bring as big a change as some fear.

Furthermore, while Bulgarian businesses will now be able to access the single euro market without further exchange risks, researchers from the National Bank of Belgium estimate that more than 80 percent of Bulgarian imports have been denominated in euros since 1999.

Since it joined the exchange rate mechanism in 2020, Bulgaria has been subject to ECB policy. Now, it will have a seat at the bank’s governing council, giving the country a say on rating policy.

There will be a transitional process for businesses and consumers. Prices in stores will be displayed in both leva and euros until August 2026, and the lev will continue to be accepted until January 31.

For six months, Bulgarians will be able to exchange leva in cash for euros at any commercial bank, post office, or the Bulgarian National Bank. Once old currencies have been collected back in, they are typically shredded and recycled.

Why are some Bulgarians sceptical about joining the eurozone?

Bulgarians are fairly evenly split on the issue of joining the eurozone. Surveys conducted by the Bulgarian firm Alpha Research showed that in May 2025, 46.5 percent supported adopting the euro, while 46.8 percent opposed it. According to pollsters, most of those against the move were residents of smaller towns and villages, often pensioners or semi-educated working-age individuals active on social media.

The main fears driving opposition to the euro are that the change will push up prices, affect buying power, and reduce wages, according to the survey.

Experiences in other countries have shown that “whenever there is a changeover from national currency to the euro, there is often a minor inflation effect, but it’s typically less than 1 percent”, analyst Zsolt Darvas of Brussels-based think tank Bruegel told The Associated Press news agency.

Speaking in the capital city, Sofia, in November, ECB President Christine Lagarde said switching to the euro would deliver “smoother trade, lower financing costs and more stable prices”. She added that adopting the euro would have a “modest” inflation impact of 0.2 to 0.4 percent.

But many Bulgarians also fear the move will lead to a loss of Bulgarian identity, as prominent figures are currently featured on lev banknotes. Ivan Milev, for example, whose image is displayed on the 5 lev note, was a prominent early twentieth-century painter who helped shape Bulgarian modernism.

Bulgaria has endured seven parliamentary elections in the past four years, and many voters are concerned about the political establishment’s ability to handle the change.

The ruling coalition, which was forced to step down in December after it proposed higher taxes, was itself divided on the issue.

It was a fragile coalition of ideologically opposed groups, including the centre-right and pro-Europe Citizens for European Development of Bulgaria (GERB) party, the pro-Russian, post-communist Bulgarian Socialist Party-United Left (BSP-OL) and the conservative-nationalist There is Such a People (ITN).

President Rumen Radev, who is backed by the BSP-OL and ITN, called for a referendum on the issue in June, citing the country’s lack of readiness and prompting heated debates in parliament. Lawmakers rejected the move, however.

Political opposition groups, particularly pro-Russian parties which are ideologically opposed to further integration with the EU, argue that adopting the euro will affect Bulgaria’s financial sovereignty and make it too dependent on Brussels.

“Someone else will decide how we spend our money, the Bulgarian budget will be approved by the European Central Bank,” Kostadin Kostadinov, leader of the pro-Russian Vazrazhdane party, told protesters calling for a referendum on the currency issue in June. “This is an antistate coup, this is treason,” he added.

Kostadinov and other far-right politicians have also been accused of spreading false claims that the savings of common Bulgarians will disappear as a result of the change, while online Russian networks are alleged to have amplified similar narratives, according to Euronews reports.

“I am against it, first because the lev is our national currency,” Emil Ivanov, a pensioner in Sofia, told the Reuters news agency. “Secondly, Europe is heading towards demise, which even the American president mentioned in the new national security strategy.

“I may not be alive when this [the EU’s demise] happens, but that is where everything is going,” she added.

Euroscepticism is rising across the continent as a whole as far-right political parties gain more influence. Nearly one-third of European voters now support far-right parties, up from just 3 percent in the mid-2000s, according to the London-based Centre for Economic Policy Research (CEPR).

However, despite the distrust, many Bulgarians are happy about joining the eurozone, particularly businesses which trade across borders and those working in the tourism sector. Government billboards in Sofia display the message: “Common past. Common future. Common currency.”

Are EU member states required to adopt the euro?

Yes, all 27 EU member states are legally obliged to use the euro, although there is no set timeframe by which they must adopt the currency. Members have the right to postpone adoption and set their own timelines, and the EU releases its own report every two years assessing members’ readiness to join the eurozone.

In January 2023, Croatia became the latest EU country to adopt the euro, relinquishing its kuna at a rate of 1 euro to 7.53 kuna (KN). It joined the EU in 2013.

Six EU members are still not part of the eurozone: Poland (which has the zloty), Denmark (krone), Hungary (forint), Romania (leu), Sweden (krona), and the Czech Republic (koruna).

Most have chosen to hold on to their currencies to maintain independence from the ECB on key issues, such as growth rates, handling inflation, or national debt, and being able to choose to devalue their currencies. Only the Romanian government has set a tentative deadline of 2027 or 2028 for joining the single currency.

Under the 1992 Edinburgh Agreement, Denmark was the only member to secure a special opt-out deal with the EU after Danish voters rejected the Maastricht Treaty in a referendum, voting instead to keep the krone. A second referendum on joining the eurozone in 2000 yielded another “no” response from 53.2 percent of voters.

The United Kingdom, which was a member of the EU until 2020, secured an opt-out when the Maastricht Treaty was being negotiated in 1992, and it never adopted the euro.

At its creation in 1999, 1 euro was worth about $1.17, and it is currently $1.18. Against the pound, the euro was initially set at about 0.70 pounds, while the current rate is approximately 0.87 pounds.