Isabel Schnabel, ECB Executive Board member, emphasized the need for central banks to adopt distributed ledger technology (DLT) to modernize financial systems. She highlighted that tokenization, while promising for wholesale finance, requires a safe settlement asset, which central bank money uniquely provides. Stablecoins, though complementary, lack the elastic liquidity supply central banks can offer. Schnabel argued that central banks should issue tokenized reserves directly on DLT platforms to preserve their role as the foundation of settlement and enhance monetary policy implementation. The Eurosystem’s Project Pontes and Appia aim to create integrated tokenized ecosystems, balancing interoperability with governance challenges. She noted that while multiple DLT architectures exist, a unified ledger could improve efficiency but poses risks of centralization. The ECB’s approach prioritizes maintaining central bank control while enabling innovation through programmable assets.
© European Central Bank, 2025.
Summary derived from the ECB website (https://www.ecb.europa.eu ).
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