ECB Advances Two-Track Plan for Digital Euro and Tokenised Finance

The European Central Bank (ECB) is advancing plans to integrate euros into blockchain technology through two distinct pathways. The first is a digital euro for everyday use, while the second focuses on tokenised finance for banks and financial institutions. The ECB’s strategy aims to enhance digital payments and support a broader tokenised financial ecosystem across Europe.

The near-term focus is on Pontes, a platform scheduled to launch on September 21, 2026. Pontes will facilitate the settlement of tokenised asset transactions using central bank money, linking the ECB’s TARGET Services with various distributed ledger technology (DLT) platforms. This allows banks to trade tokenised bonds on blockchains and settle transactions directly in euros, eliminating the need for private intermediaries. The platform will initially include 13 market participants, such as Deutsche Bank and Santander.

The ECB is also investing in tokenised euro-area public-sector securities, with settlements handled through Pontes. Meanwhile, the Appia initiative aims to build an integrated tokenised finance ecosystem by 2028, addressing standards, interoperability, and governance. ECB Executive Board member Isabel Schnabel outlined three technical models for moving central bank money onto blockchain platforms, emphasizing scalability and stability.

The retail digital euro, however, faces a longer timeline. Trialogue negotiations on its legislative framework began in July 2026, with a target completion date by the end of 2026. Merchant pilot programs are expected to start in mid-2027, with a potential first issuance of the digital euro anticipated in 2029.