The European Central Bank is preparing to integrate its currency into tokenized financial markets. Isabel Schnabel, member of the ECB’s Executive Board, presented three models for circulating bank reserves on distributed ledger technology infrastructure: direct issuance of tokenized reserves, a gateway linking current systems to DLT platforms, or a private intermediary issuing tokens backed by reserves. The institution aims to preserve the two-tier monetary system, with central bank money remaining the reference settlement asset. The Pontes project, launched on September 21, already enables settlement of transactions on tokenized assets in central bank money, while Appia is working on the architecture of a future tokenized European market with a roadmap planned for 2028.
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