The European Central Bank (ECB) brought Pontes into operation on Monday, the system that allows wholesale transactions in tokenised assets — shares, bonds and other instruments recorded as digital tokens on distributed ledgers (DLT) — to be settled in central bank money.
It is the first concrete delivery of the Eurosystem's strategic programme for tokenised finance, announced in March.
"Pontes brings the stability and trust of central bank money to the European tokenised finance ecosystem," said Piero Cipollone, a member of the ECB's Executive Board, in the institution's statement. President Christine Lagarde said the bank "will continue to make progress in close collaboration with the market".
The problem the system sets out to solve
Until now, anyone trading tokenised assets in Europe settled the cash leg in commercial bank money or in stablecoins. Both options carry the credit risk of the issuing institution — an obstacle for institutional investors, who are reluctant to hold exposure to a private counterparty at the moment a trade closes.
Pontes works as a bridge between the market's DLT platforms and TARGET Services, the Eurosystem's payment infrastructure. Final settlement takes place in T2, the euro area's real-time gross settlement system, under two possible models: through cash tokens or directly in T2. There is also an interoperability mechanism for delivery-versus-payment transactions across different platforms.
Who is already connected
Thirteen market participants have completed the initial onboarding: ABANCA, BayernLB, Caisse des Dépôts et Consignations, Cecabank, Deka Bank, Deutsche Bank, DZ Bank, the European Investment Bank, Kreditanstalt für Wiederaufbau (KfW), Memo Bank, NRW.BANK, Santander and Société Générale. The Deutsche Bundesbank has also joined, in a market participant capacity.
On the infrastructure side there are four DLT operators: Axiology, Cashlink, Clearstream and SWIAT.
The ECB says the system starts within existing market hours. Full capability — with an extended operating window and new features — is expected by 2028, in stages.
The ECB as an investor
On the same day, the ECB published a second statement announcing that it will invest "a small portion" of its own funds portfolio in tokenised securities, settled through Pontes. The initial focus will be euro-denominated paper issued by euro area central and regional governments, agencies and European supranational institutions.
"By investing directly, the ECB will gain first-hand experience across the full investment lifecycle, including trade execution, settlement, systems and portfolio management activities," the text says. The amount and the timetable have yet to be set: the Executive Board will fix them once the preparatory work is complete.
Pontes is not the digital euro
The two tracks should not be confused. Pontes is wholesale: it serves banks, asset managers and infrastructure operators. The digital euro, the version for the general public, is at an earlier stage — final legislation is expected by the end of 2026 and a pilot could begin in September 2027, according to Euronews.
In parallel, the Eurosystem is developing Appia, an initiative for an integrated DLT-based financial services ecosystem, with Danmarks Nationalbank and public and private stakeholders taking part. Its blueprint also has 2028 as its horizon.
With information from the European Central Bank and Euronews.
