ECB Launches Blockchain Payment Service, Invests in Digital Securities

The European Central Bank has launched a new blockchain-based payment service called Pontes, which connects its payment infrastructure to financial markets. The service enables banks and investors to settle blockchain-based transactions using central bank money in euros.

The ECB plans to invest a small portion of its own funds in digital securities, focusing on highly rated, euro-denominated debt issued by public institutions. This move will give the central bank direct exposure to tokenised financial assets while allowing it to gain practical experience with blockchain-based markets.

The ECB sees blockchain as having the potential to make financial transactions faster and more efficient by combining different stages of an asset's lifecycle and enabling greater automation.