ECB Prepares to Invest in Tokenised Securities

The European Central Bank (ECB) has begun preparations to invest its own funds in tokenised securities, aiming to gain practical experience with distributed ledger technology (DLT) and its use in financial markets.

The investments will be settled in central bank money through Pontes, the Eurosystem's settlement solution for tokenised assets. The ECB said the initiative will support its broader strategy to adapt central bank money to increasingly digital financial markets.

Initial purchases will focus on euro-denominated securities issued by euro area central and regional government entities, agencies, and European supranational institutions. The bank expects the investments to provide first-hand experience across the investment lifecycle, including trade execution, settlement, and portfolio management.