The post ECB exec calls to embrace DLT, tokenization to improve Europe’s ‘fragmented’ capital markets appeared on BitcoinEthereumNews.com.

Piero Cipollone, a member of the European Central Bank’s (ECB) Executive Board, urged Europe to embrace digital assets and distributed ledger technology (DLT) to create an integrated capital markets union. Speaking at the Bundesbank Symposium on the Future of Payments on Oct. 7, Cipollone outlined how digital technologies can reshape Europe’s fragmented financial system, reducing intermediation costs and improving market efficiency. Fragmentation Cipollone pointed out that Europe’s 35 different listing exchanges and 41 trading platforms contribute to an inefficient and divided financial landscape. He added that despite efforts like the TARGET2-Securities platform, which harmonizes securities settlements across the continent, regulatory barriers and inconsistent legislative frameworks continue to hinder integration. Cipollone highlighted that without harmonized rules on asset custody, tax processes, and regulatory supervision, Europe remains unable to fully realize the synergies of a unified capital market. He added that this fragmentation makes European markets less competitive globally and called for accelerated efforts to align regulations across EU member states. According to Cippollone: “The lack of a unified supervision or a permanent safe asset has left Europe’s capital markets fragmented.” The EU has made steps towards integration, but Cipollone argued that these efforts must intensify, particularly with the rise of digital assets. Tokenization, the process of issuing assets on distributed ledger technology (DLT), offers the opportunity to create a more efficient system from the start, bypassing traditional market inefficiencies. Integrated market Cipollone highlighted tokenization as a key driver of financial transformation, offering significant opportunities to improve liquidity and reduce transaction costs. Unlike conventional financial assets, digital assets on distributed ledgers do not rely on a central database but instead, operate on a synchronized network of decentralized traders. According to Cippollone: “This could mark the shift from centuries-old bookkeeping systems to a future of decentralized, real-time transactions.” He also noted that over 60% of EU banks…

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Filed under: News - @ October 8, 2024 10:22 pm