The European Union's Nobel Peace Prize is being awarded at a time when it is becoming clear that the EU's single currency, which has survived three years of financial turmoil, is not going to fall apart. However, despite avoiding a potentially messy breakup, the euro zone still faces challenges and risks becoming an unequal and strained partnership. Recent developments have shown that the euro is likely to remain with all 17 members and possibly expand in the future. However, the region still struggles with economic stagnation, high unemployment, and social issues that are creating divisions between northern and southern Europe and fueling anti-EU sentiment in various countries. The European Central Bank's decision to buy unlimited quantities of bonds from troubled member states has provided some stability to the euro zone, but the region has yet to find a way out of its economic troubles. ECB President Mario Draghi emphasized the bank's commitment to using all available tools to prevent anyone from speculating on the breakup of the monetary union. The euro zone's permanent rescue fund, which offers a 500 billion euro backstop for countries at risk of losing access to capital markets, recently went into effect after overcoming legal challenges. German Chancellor Angela Merkel's visit to Athens indicated that Germany, the EU's most powerful economy, wants Greece to remain in the euro area, putting an end to debates in Berlin about potentially expelling Greece. Furthermore, the flood of predictions about the euro's collapse from financial institutions in London and New York has suddenly ceased, and the number of short bets against the euro in currency markets has decreased. Bond yields have decreased and bank stocks have rebounded. Spanish banks are borrowing less from the ECB as some are regaining access to money markets. The likelihood of a Greek exit from the euro, or "Grexit," has decreased according to economists at Citigroup, who now believe key euro zone players see more harm than good in a Greek exit. While the probability of a "Grexit" has been lowered to 60 percent from 90 percent, Citigroup still believes Greece is likely to leave the euro within the next 12-18 months. However, they argue that European governments are unlikely to agree to forgive part of Greece's significant debt to ensure sustainability. It is suggested that debt forgiveness may still be a possibility after the next German general election. It might appear to be a more logical, although unpopular, choice compared to a disorderly Greek default and exit, which would have severe economic and social consequences for Greece and Europe. The International Monetary Fund recently criticized the EU's policy response, stating that it is incomplete and leaves the euro area vulnerable to capital flight, breakup fears, and economic decline. The IMF is pushing for faster progress in the euro zone, particularly in Germany, towards a banking union and closer fiscal integration, as well as a change in the balance between austerity and growth. The IMF also admitted underestimating the negative impact of budget cuts on growth and called on Europe to relax austerity measures, which was met with opposition from Germany's finance minister. The effects of the sovereign debt crisis will continue to be felt for years to come, particularly in financial markets. Austerity measures and economic downturn are causing severe social repercussions in countries like Athens and Madrid, pushing middle-class families, retirees, and young people into poverty and insecurity. This crisis has shifted the balance of power in Europe, giving Germany and its allies more control in decision-making within the euro zone. This has led to the possibility of a two-tier Europe, with a tighter inner core and a looser outer circle. Germany is resistant to taking on more financial responsibility for struggling euro zone countries and is opposed to common euro zone bonds or joint bank guarantees. Finance ministers from Germany, the Netherlands, and Finland are working to prevent the retroactive use of euro zone rescue funds. Berlin is in favor of the idea of creating a separate budget for the euro zone to deal with economic shocks and supports a single banking supervisor, which could lead to increased risk-sharing in the future. As the euro area becomes more unified, non-euro EU countries like Poland, Hungary, and Latvia are faced with difficult decisions. They are eager to join the monetary union and are pushing to have a say in decisions made by the banking supervisory authority. Poland recently tried to gain entry to the Eurogroup by offering to participate in a financial transaction tax, but was informed that only euro zone members could attend. Britain is not planning to join the euro or banking union, but wants a veto right to safeguard its financial sector. It also sees the closer integration of the euro zone as a chance to renegotiate its own European ties. Sweden, with a pro-euro government that was defeated in a referendum on joining the currency in 2003, is less certain about the euro zone progressing without it. This situation is creating tension in Europe as it undergoes a period of restructuring that will challenge its ability to maintain peace and prosperity on a divided continent, as recognized by the Nobel Prize.