From vision to delivery: building Europe’s tokenised financial market

Piero Cipollone, Member of the Executive Board of the European Central Bank, delivered a speech at the Deutsche Bundesbank’s symposium on the future of payments. He reflected on Europe’s progress in developing a digital assets ecosystem based on tokenisation and distributed ledger technology (DLT).

Two years ago, he highlighted Europe’s opportunity to reshape financial markets through tokenisation, which can simplify processes and reorganise the entire financial value chain. He emphasized the importance of building an integrated European market for digital assets to avoid fragmentation and ensure the use of central bank money as a secure settlement asset.

The ECB has made significant progress, including the launch of projects Pontes and Appia. Pontes will enable settlement of tokenised transactions in central bank money, with plans to expand operational hours and functionality by 2028. Appia aims to develop standards, governance, and infrastructure for a unified European tokenised financial ecosystem, with a roadmap targeting 2028.

The speech outlined three key conditions for success: interoperability based on common standards, public-private cooperation for adoption, and a harmonized legal framework. Achieving these will facilitate market integration, competition, resilience, and innovation across Europe.

Mr. Cipollone concluded that acting now is crucial to prevent fragmentation and to build a deeper, more competitive European capital market, leveraging technological advancements to support long-term financial integration.