- European Central Bank approves a two-track plan to enable blockchain-based financial transactions using central bank money.
- The first track, called Pontes, will connect distributed ledger technology platforms with TARGET Services for settlement in the eurozone.
- Pontes is set for a pilot launch by the end of Q3 2026, using lessons from 2024’s blockchain trials.
- The second track, Appia, focuses on long-term DLT adoption and ongoing collaboration with public and private partners.
- Recent trials settled $1.88 billion in tokenized assets, showing strong market demand but highlighting the need for standardization and legal frameworks.
European Central Bank (ECB) has approved a dual-track approach to settle financial transactions conducted on distributed ledger technology (DLT) platforms using central bank money. The strategy is designed to modernize the eurozone’s financial system, with a pilot program planned to begin by the end of the third quarter of 2026.
The first track, named Pontes, will serve as a short-term solution. Pontes aims to link blockchain-based financial platforms with TARGET Services—a suite of payment and securities services operated by the Eurosystem. According to the ECB, this pilot will use findings from 2024 DLT experiments, which involved over 50 trials and 64 participants, to test a unified settlement system in central bank money.
“The decision is in line with the Eurosystem’s commitment to supporting innovation without compromising on safety and efficiency in financial market infrastructures,” the ECB stated. The official announcement detailed plans for industry-wide contact groups to gather feedback and maintain ongoing dialogue between the central bank and market participants.
The second track, called Appia, targets broader, long-term changes. Appia will focus on researching DLT use in wholesale central bank settlements and work toward an integrated European financial ecosystem. Both Pontes and Appia will involve contact groups to collect input from relevant stakeholders.
A new report from the ECB shows that $1.88 billion worth of tokenized assets were settled in central bank money during its DLT trials, confirming substantial market demand. The report notes that DLT—often called blockchain—can simplify financial processes by enabling real-time, automated settlements and reducing inefficiencies in capital markets.
However, the ECB highlighted the importance of developing common standards, harmonized legal structures, and fast integration points with TARGET Services to ensure safe and effective adoption of this emerging technology.
The ECB’s move follows similar experimentation by other central banks, such as the Bank of England’s large-scale DLT settlement test in 2023, which demonstrated that blockchain can reduce costs and increase the speed of large interbank payments.
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