Latest news with #Eurosystem
Yahoo
03-07-2025
- Business
- Yahoo
EU Central Bank Commits to Distributed Ledger Technology Settlement Work
The European Central Bank (ECB) Governing Council has approved research efforts that will use central bank money to settle distributed ledger technology (DLT) transactions, as the body looks to make its payment systems more efficient. One short term approach is called "Pontes" which will link DLT platforms with Eurosystem TARGET services that ensure the flow of cash and securities across Europe. A pilot will be launched by the third quarter of 2026. A more long term solution called "Appia" will facilitate global operations and analyze DLT-based solutions, the post said on Tuesday. "The decision is in line with the Eurosystem's commitment to supporting innovation without compromising on safety and efficiency in financial market infrastructures," the release said. The ECB has been exploring how to utilize DLT technology to boost payments settlement, something which central banks across the world have been looking at. It conducted exploratory work on wholesale central bank money settlement between May and November 2024. A report on the results of this work was also published on Tuesday that identified DLT having benefits such as reducing costs and countering credit and settlement in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Crypto Insight
03-07-2025
- Business
- Crypto Insight
ECB to pilot blockchain-based euro settlement system by 2026
The European Central Bank (ECB) has approved a two-track plan to settle distributed ledger technology (DLT) transactions using central bank money, which could pave the way to modernizing Europe's financial system. The first track, dubbed Pontes, will focus on a short-term solution by linking blockchain-based DLT platforms with TARGET Services, a suite of financial services developed and operated by the Eurosystem designed to facilitate the flow of payments and securities within the eurozone. A pilot for Pontes is expected to launch by the end of the third quarter of 2026, the ECB said Tuesday. This pilot will use insights from the ECB's exploratory DLT trials in 2024, which involved over 50 experiments and 64 participants, to test a unified settlement system with 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 wrote. Second track takes long-term approach The second track, called Appia, takes a longer-term approach, aiming to develop an 'integrated ecosystem in Europe that also facilitates safe and efficient operations at the global level.' Appia will see the ECB continue to study DLT applications in wholesale central bank settlements while working closely with public and private partners. The Eurosystem will also set up market contact groups for both Pontes and Appia to maintain dialogue with industry stakeholders and gather feedback. A call for expressions of interest to join the Pontes group will be published soon. The plan comes as central banks worldwide explore how blockchain can streamline settlements while maintaining control over money flows. In 2023, a Bank of England experiment, conducted through the BIS London innovation hub, successfully tested using DLT to run large-scale interbank transactions. It demonstrated a prototype that could speed up and lower the costs of real-time gross settlement (RTGS) systems by linking them with other financial infrastructures and ledgers. Cointelegraph reached out to the ECB for comment but had not received a response by publication. DLT trials reveal demand for central bank money The ECB also published a report detailing the results of its recent DLT exploratory work. The report confirmed strong market demand for settling tokenized assets in central bank money, with 1.6 billion euros ($1.88 billion) settled during trials involving 64 participants across Europe. The findings show DLT could reduce 'fragmentation, complexity and technological inefficiencies' in capital markets by enabling atomic, programmable settlement. However, it pointed out the need for standardization, harmonized legal frameworks, and 'an interoperability link with TARGET Services as soon as feasible.' Source:
Arabian Post
02-07-2025
- Business
- Arabian Post
ECB Embarks on Dual‑Track DLT Settlement Strategy
The European Central Bank has green‑lit a pioneering dual‑track framework to enable settlement of transactions on distributed ledger technology platforms using central bank money. The Governing Council's initiative combines a short‑term pilot, dubbed Pontes, scheduled to interface DLT platforms with TARGET Services by the end of the third quarter of 2026, and a longer‑term initiative, Appia, which seeks to establish a future‑proof global DLT infrastructure. Pontes represents the near‑term goal: creating a secure link between existing DLT platforms and the Eurosystem's TARGET services—namely TARGET2, T2S and TIPS—through a unified Eurosystem solution. It builds directly on exploratory work carried out between May and November 2024, where 64 participants explored over 50 experimental setups that used intraday escrow and liquidity tokens. The ECB has indicated its intention to invite expressions of interest from the market to join Pontes' pilot phase, expected to commence by Q3 2026. The longer‑term Appia track explores integration of DLT in a broader ecosystem, extending into global payment and securities infrastructures. This initiative aims to support international use cases such as cross‑border foreign exchange settlements and compliance with global standards, collaborating with public and private sector stakeholders to assess interoperability, scalability and legal frameworks. ADVERTISEMENT During the 2024 discovery phase, experiments featured diverse approaches, including trials led by the Banque de France and Banca d'Italia. These trials used escrow-based intraday liquidity provision mechanisms that participants later advocated to evolve into overnight capabilities, shedding light on liquidity management inefficiencies. Officials noted the potential for simultaneous settlement and collateral automation to cut credit and liquidity risks, while potentially reducing operational costs. Piero Cipollone, a member of the ECB's Executive Board, remarked that although DLT and tokenisation remain nascent, they 'are likely to offer new ways of improving the settlement of financial transactions.' He emphasised that the dual‑track approach serves innovation while maintaining security and efficiency in financial market infrastructure. Pontes and Appia will operate under dedicated market contact groups. The ECB intends to outfit each with analysts and market participants to ensure operational robustness and collect stakeholder feedback as integration proceeds. With Pontes launching a Q3 2026 pilot, the ECB is concurrently reviewing additional trial proposals for integration within existing TARGET services frameworks. The initiatives support the Eurosystem's wider ambition to modernise wholesale settlement systems. Appia is envisioned as an evolution towards integrated ecosystems that support global operations and stimulate interoperability with other jurisdictions, thereby elevating Europe's position in the digital infrastructure space. European authorities have signalled enduring commitment to innovation since experimental work in 2024. The report released today, aligned with Pontes and Appia's dual‑track launch, highlights how central banks across the continent are balancing emerging technologies with systemic resilience goals—managing legal, technical and liquidity implications harmoniously. Market analysts believe the Pontes initiative addresses immediate demand from DLT innovators for central bank money settlement in familiar frameworks, while Appia opens the door to more ambitious, globally interoperable DLT ecosystems. Senior banking figures in Frankfurt have described the move as a 'critical turning point' in central banks embracing digital transformation to reduce transaction costs and boost cross-border efficiency across Europe. The ECB's decision signals readiness to bridge traditional financial infrastructure with blockchain-based innovations without compromising safety or oversight. Through Pontes, the Eurosystem seeks to preserve market standards for liquidity and settlement, building confidence among banks and fintechs in central bank money λ integration. Appia, in turn, presents a vision of digital finance aligned with evolving global regulation and technological standards. This marks the first time the ECB has approved a formal pilot to connect central bank money with DLT platforms. The outcomes of Pontes will help shape future integrations—potentially serving as a template for central bank digital currencies and wholesale tokenised ecosystems. The experiments under Appia could establish key precedents for global interoperability standards and regulatory coordination, reinforcing the Eurosystem's role as a leader in secure, innovative payment infrastructures.
Yahoo
02-07-2025
- Business
- Yahoo
EU Central Bank Commits to Distributed Ledger Technology Settlement Work
The European Central Bank (ECB) Governing Council has approved research efforts that will use central bank money to settle distributed ledger technology (DLT) transactions, as the body looks to make its payment systems more efficient. One short term approach is called "Pontes" which will link DLT platforms with Eurosystem TARGET services that ensure the flow of cash and securities across Europe. A pilot will be launched by the third quarter of 2026. A more long term solution called "Appia" will facilitate global operations and analyze DLT-based solutions, the post said on Tuesday. "The decision is in line with the Eurosystem's commitment to supporting innovation without compromising on safety and efficiency in financial market infrastructures," the release said. The ECB has been exploring how to utilize DLT technology to boost payments settlement, something which central banks across the world have been looking at. It conducted exploratory work on wholesale central bank money settlement between May and November 2024. A report on the results of this work was also published on Tuesday that identified DLT having benefits such as reducing costs and countering credit and settlement risks.
Finextra
01-07-2025
- Business
- Finextra
ECB commits to distributed ledger technology settlement plans
The European Central Bank has agreed to a dual-track strategy for integrating distributeed ledger technology with Target settlement services in the wholesale market. 1 The project, which is the outcome of a series of exploratory works, will enable the settling of distributed ledger technology (DLT) transactions using central bank money. Conducted between May and November 2024, the exploratory work involved 64 participants and the running of over 50 trials and experiments While the CB is still inviting requests for further DLT-related trials and experiments, the immediate plans call for a two-track approach: the first track 'Pontes' provides a short-term offering to the market - including a pilot phase - and the second track 'Appia' focuses on a potential long-term solution. The Eurosystem plans to launch a pilot for Pontes by the end of the third quarter of 2026 that will explore the feasibility of further enhancements in line with the Target Services operational, legal and technical standards. Appia focuses on a long-term approach for an integrated ecosystem in Europe that will also interconnect with other financial market infrastuctures at the global level. To maintain continuous dialogue with the market, the Eurosystem says it will establish dedicated market contact groups for both Pontes and Appia. A call for expressions of interest in participating in the Pontes contact group will be published soon.
