The European Union's Nobel Peace Prize was awarded as the realization sets in that the EU's single currency has survived three years of financial turmoil and is unlikely to break up. While the euro has avoided a contentious split and retained all 17 members, it faces challenges that could lead to an unequal and strained relationship with frequent disagreements. Despite recent clarity that the euro is here to stay and may even expand in the future, the euro zone still struggles with economic stagnation, unemployment, and social issues that are widening the gap between northern and southern Europe. The European Central Bank's decision to buy unlimited bonds from troubled member states has provided some stability to the euro zone. ECB President Mario Draghi emphasized that the bank will utilize all available resources to combat anyone speculating on the dissolution of the monetary union. The euro zone's permanent rescue fund was finally implemented last week following extensive negotiations and legal obstacles, providing a 500 billion euro safety net for countries at risk of losing access to capital markets. Additionally, German Chancellor Angela Merkel's visit to Athens indicated that the EU's most influential economy is committed to keeping Greece within the euro area, putting an end to months of deliberation in Berlin, particularly within her own coalition, regarding the expulsion of Greece. Interestingly, the multitude of predictions regarding the collapse of the euro that were circulating from financial institutions and political risk analysis firms in London and New York have suddenly ceased. Furthermore, the decrease in short positions against the euro in currency markets has also been noted. Bond yields have dropped and bank stocks have rebounded. Spanish banks are borrowing less from the ECB as some are able to access money markets again. The likelihood of Greece leaving the euro, known as "Grexit," has decreased as key euro zone players believe it would be more harmful than helpful. Citigroup economists have reduced the probability of a Grexit from 90 percent to 60 percent, but still predict Greece will likely leave the euro within the next 12-18 months due to unsustainable debt. However, there is still a possibility that part of Greece's debt could be forgiven, especially after the upcoming German general election. It might appear to be a more logical, although unpopular, choice compared to a disorderly Greek default and exit, which could have devastating economic and social repercussions for Greece and Europe. Despite some relief in European existential concerns, the International Monetary Fund recently criticized the EU's incomplete policy response, warning of potential capital flight, breakup fears, and economic decline in the euro area. The IMF is pushing for faster progress in the euro zone, particularly from Germany, in implementing a banking union and closer fiscal integration, and adjusting the balance between austerity and growth. The IMF admitted it had underestimated the negative impact of budget cuts on growth and called for Europe to relax austerity measures, prompting a strong reaction from Germany's finance minister. The effects of the sovereign debt crisis will continue to wreak havoc for years to come, with financial markets feeling the shift in perceptions more than the general public. Austerity measures and economic downturn are causing significant social upheaval in countries like Athens and Madrid, pushing many middle-class families and retirees into poverty and increasing precarity for the unemployed and young people. This crisis has shifted the balance of power in Europe, giving Germany and its northern allies more influence in decision-making within the euro zone, while weakening and further marginalizing southern states. The idea of a two-speed Europe, where countries progress at different rates, is now potentially evolving into a two-tier system, with a tighter inner core within the euro zone and a looser outer circle including countries like Britain and Sweden. Germany is adamant about limiting its financial responsibility for other euro zone countries, refusing to issue common euro zone bonds or provide joint bank guarantees. Finance ministers from Germany, the Netherlands, and Finland are also working to prevent any 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 its support for a single banking supervisor will likely lead to more shared risk in the future. As the euro area becomes more unified, countries outside the currency face difficult decisions. Some countries, like Poland, Hungary, and Latvia, are eager to join the euro zone and are pushing to have a say in decisions made by the banking supervisory authority. Poland recently tried to gain a seat at the Eurogroup table by offering to participate in a financial transaction tax group, but was informed that only euro zone members could attend. Britain is not planning to join the euro or the banking union, but is requesting a veto right to safeguard its significant financial sector from decisions made by others. It also hopes to use the increased integration of the eurozone as an opportunity to negotiate a reduction in its own ties to Europe. Sweden, on the other hand, has a pro-euro political establishment but is hesitant and conflicted about the eurozone progressing without its involvement. These dynamics suggest that Europe is entering a challenging period of reorganization that will put its ability to build peace and prosperity on a divided continent to the test.