European Central Bank Executive Board member Piero Cipollone warned that tokenized deposits and stablecoins in Europe will only scale if they rest on tokenized central bank money as a public settlement anchor. In remarks delivered in Brussels, Cipollone pointed to Pontes, the Eurosystem’s distributed ledger technology settlement initiative, which aims to connect market DLT platforms with the Eurosystem’s TARGET Services and settle transactions in central bank money.

The ECB has signaled that Pontes could be launched in the third quarter of 2026, enabling market participants to settle DLT-based transactions using central bank money. The comments extend the ECB’s broader Appia initiative, which the central bank outlined on March 11 as a blueprint for a future European tokenized financial ecosystem by 2028.

Related: The ECB has been advancing work on tokenization and digital finance, including efforts around the digital euro and related settlement infrastructure.

Key takeaways

Tokenized financial assets in Europe would require tokenized central bank money to serve as a low-risk settlement anchor, reducing exposure to price volatility or credit risk.
Pontes, the Eurosystem’s DLT settlement initiative, aims to interlink market DLT platforms with central bank payment rails, with a planned initial launch in Q3 2026.
The Appia roadmap seeks to establish interoperability standards so tokenized assets can transfer smoothly across different DLT ecosystems, supported by standardized data formats and smart contract protocols.
Beyond technology, Cipollone underscored the need for a coherent legal framework and stronger public-private collaboration to support tokenized markets at scale.
Regulatory progress is underway, but industry participants—along with issuers of stablecoins—are pressing for broader guidance, including expansion of the DLT Pilot Regime and related cash account services for authorized providers.

Tokenized markets hinge on central bank settlement rails

In his Brussels address, Cipollone framed the issue around the core risk that currently limits scale: when a seller of a tokenized security is paid in an asset they would rather not hold, the resulting counterparty risk and volatility can chill adoption. He emphasized that central bank money can serve as a stable, trusted settlement asset, mitigating liquidity and credit concerns that might otherwise deter market participants from embracing tokenized instruments. The stance aligns with a broader ECB push to anchor tokenized finance in public money while maintaining market resilience.

As part of this vision, Pontes is described as a bridge between private market platforms and the Eurosystem’s settlement rails. If successful, the project would make it feasible to settle tokenized trades directly in central bank money, enhancing finality and reducing settlement risk across Europe’s growing tokenized ecosystem.

Appia: interoperability as the backbone of a tokenized Europe

The Appia initiative, introduced by the ECB, is designed to provide a blueprint for a European tokenized financial infrastructure through 2028. A central pillar is an interoperability standard for assets, enabling cross-platform transfers of tokenized securities and other instruments. In practice, this means harmonizing data formats and smart contract standards so that tokenized assets can move between DLT networks without bespoke bridge solutions.

Cipollone urged market infrastructure operators, banks, custodians and technology providers to engage with the Appia roadmap, offering feedback to help foster broader public-private partnerships. The underlying expectation is that a shared standard will reduce fragmentation, lower integration costs and accelerate adoption across European markets.

Legal clarity and the regulatory path forward

Beyond technology, Cipollone argued that Europe needs a more explicit legal framework to support tokenized issuance and transfer across the bloc. He flagged that while Appia and other initiatives push the technical envelope, a coherent regulatory foundation is essential to prevent a patchwork of rules that could hinder scalable settlement infrastructure.

The European Commission’s proposal to extend the DLT Pilot Regime was described as an important step, yet Cipollone cautioned that without a comprehensive tokenization framework, the region risks building high-value settlement infrastructure atop inconsistent rules. In this context, a dedicated legal framework for tokenized assets could help harmonize issuance, transfer and custody across member states.

Industry response and the next steps

The interview comes on the heels of industry activity responding to Europe’s tokenization push. Recently, stablecoin issuer Circle submitted feedback to the European Commission’s Market Integration Package, urging lawmakers to broaden the DLT Pilot Regime and to allow e-money token cash accounts for authorized crypto-asset service providers. The broader takeaway from market participants is a call for practical, scalable paths to tokenized finance, rather than piecemeal reforms that complicate cross-border settlement.

Looking ahead, the ECB’s public-private collaboration around Appia, the Pontes settlement rails, and the evolving legal framework will be in focus for institutions seeking to participate in Europe’s tokenized finance era. As with any large-scale infrastructural shift, progress will likely hinge on coordinated industry input, regulatory clarity and tangible pilot outcomes.

Readers should watch upcoming updates on Pontes’ pilot milestones and the Appia roadmap’s public consultation cycles. While the Q3 2026 launch window is a concrete near-term milestone, the broader question remains: can Europe converge on a unified framework that makes tokenized central bank money the default settlement anchor for tokenized markets?

This article was originally published as ECB: Central-bank money needed to scale stablecoins, tokenized deposits on Crypto Breaking News – your trusted source for crypto news, Bitcoin news, and blockchain updates.

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Filed under: News - @ March 24, 2026 11:23 am