European Central Bank Launches Pontes Platform for Institutional Blockchain Payments

The European Central Bank has launched its Pontes platform, enabling banks to settle payments for financial asset transactions on the blockchain using central bank money.

The system is not open to consumers but rather to financial institutions that meet specific participation criteria.

Pontes connects market platforms using distributed ledger technology to the Eurosystem's TARGET Services infrastructure, allowing participating banks to settle cash payments for inter-institutional transactions of tokenized assets using central bank money.

The system is an alternative to stablecoins and tokenized forms of commercial bank deposits, according to ECB President Christine Lagarde, who announced its launch at the Eurogroup meeting on Friday. It aims to maintain the role of central bank money in European financial markets where more and more assets are being tokenized.