Piero Cipollone, a member of the ECB Executive Board, told an audience at the House of the Euro in Brussels on March 23 that Europe's emerging tokenised financial market faces three structural barriers: incompatible DLT (distributed ledger technology) networks operating in isolation, the absence of tokenised central bank money for settling trades, and a legal framework that still cannot reliably handle cross-border tokenised securities. His proposed answer spans two initiatives with staggered timelines stretching to 2028.

Two Initiatives, Two Timescales

The nearer-term project is called Pontes. Scheduled for launch in Q3 2026, it will act as a bridge connecting private DLT platforms to the Eurosystem's existing TARGET settlement services, allowing transactions on those platforms to settle in central bank money rather than in private instruments. Pontes is designed as a starting point, with 24/7 operation and smart contract functionality listed as planned upgrades rather than launch features.

That near-term readiness reflects a substantial preparatory foundation. Between May and November 2024, the Eurosystem conducted an exploratory exercise involving 64 private-sector participants, more than 50 trials across nine jurisdictions, and approximately 1.59 billion euros in transactions processed. That body of experience directly informs Pontes' design and explains why a 2026 launch is credible rather than aspirational. Major market infrastructure operators including Euroclear, Clearstream, and DTCC participated in the trials, and the ECB has signalled that institutions of that kind are expected to anchor Pontes in practice.

The longer-term project, called Appia, is a full blueprint for redesigning European wholesale tokenised finance. The ECB published the Appia roadmap on March 11 and is accepting feedback from market participants, public sector bodies, and researchers until April 22. The blueprint targets delivery in the second half of 2028 and is built around five areas: technical standards, interoperability, collateral management, cross-border connectivity, and the legal and regulatory foundations that underpin all of them.

Why Central Bank Money Matters Here

Cipollone was direct about the settlement risk at stake. Without tokenised central bank money, he warned, a seller of a tokenised security may receive payment in an asset they are not comfortable holding, one exposed to price volatility or credit risk.

He added: "Confidence cannot rest on private settlement assets alone."

The concern is practical. Privately issued stablecoins, even those backed by fiat currency, rarely trade at par during normal market conditions, according to ECB research cited in the speech.

Central bank money carries no credit or liquidity risk by design. "Central bank money is the safest and most liquid settlement asset. It does not carry any credit or liquidity risk," Cipollone said, describing it as the safest available monetary anchor for institutional settlement.

The ECB has already taken one concrete step: as of this month, it began accepting DLT-based assets issued through central securities depositories as eligible collateral for its credit operations.

The Numbers Behind the Urgency

European issuers have placed roughly 4 billion euros in DLT-based fixed-income instruments since 2021. That figure is growing, but it looks modest against the global picture. According to data from RWA.xyz, the total value of tokenised real-world assets held on-chain globally now stands at approximately $26.48 billion, up 5.25% month-on-month, while the represented asset value behind those tokens exceeds $387 billion, itself rising 6.84% over the same period.

The gap in sovereign debt tokenisation is particularly stark. Spiko's EU T-Bills fund, the leading European government debt tokenisation product, holds roughly $975 million. The top four US Treasury tokenisation products, USYC, BUIDL, USDY, and BENJI from Franklin, combined hold more than $6.7 billion, about seven times as much. BlackRock's BUIDL fund alone accounts for $2.01 billion of that total. Analysts note that the ECB's push is in part a response to that asymmetry.

A Signal to Regulators in the Global South

Cipollone's speech carries implications beyond Europe. His warning about stablecoin reliability echoes regulatory positions already held by central banks in India, Nigeria, and South Africa, all of which have placed restrictions on foreign stablecoin use. In markets where Tether's USDT and Circle's USDC serve as the primary on-ramps to crypto and DeFi, the question of who controls the settlement layer for digital money is not abstract.

India's Reserve Bank is already running a wholesale CBDC programme through the e₹-W (digital rupee wholesale), specifically designed for government securities delivery-versus-payment settlement, and has pushed to include a BRICS CBDC bridge on its 2026 agenda. The mBridge model, developed through collaboration among the Bank for International Settlements and several central banks, has also been cited as a potential template for India-EU interoperability, though no formal agreement exists. That agenda could produce cross-border standards that diverge from Appia's framework. For financial institutions in South Asia and Africa, the design choices the ECB makes on cross-border access and open standards will determine whether Appia becomes a genuinely international rail or another hub built primarily for European participants.

In Africa, wholesale tokenisation activity remains nascent and is primarily stablecoin-driven rather than institutional in character. The South African Reserve Bank has been identified as a key policy audience for Appia's cross-border access framework. Regional initiatives such as Project Sunbird, which is exploring tokenised settlement among Common Monetary Area countries, signal growing interest in the continent, but the infrastructure gap relative to Europe and the United States remains wide.

The ECB has said it will engage foreign central banks on cross-border legal and regulatory questions as part of the Appia process, but no formal multilateral dialogue has been announced.

What Comes Next

The Appia consultation closes April 22 and is open to market participants, public sector bodies, and academia.

Cipollone told the Brussels audience that the window in which Europe's early advantages can be turned into lasting leadership remains open but is narrowing.

In a blog post published on March 12, he was equally pointed about the alternative. "If Europe does not build its own digital roads, it risks having to rely exclusively on those built by others," he wrote, invoking a highway metaphor that runs through his broader public argument for a European-built digital finance infrastructure.

A single shared ledger and a network of interconnected platforms both remain on the table as architectural models. The ECB has not yet chosen between them, and that decision will shape which blockchains, protocols, and developer toolkits become viable for European institutional finance for years to come.