The European Central Bank (ECB) is conducting trials to explore the application of distributed ledger technology (DLT) in wholesale central bank money settlement. This initiative is a forward-looking move towards understanding and leveraging DLT’s potential to enhance the efficiency, security, and resilience of financial transactions – especially in the context of the evolving digital Euro landscape.
The trials, set to run from May to November 2024, are part of the ECB’s broader strategy to assess the feasibility and advantages of employing DLT in the core processes of financial transactions. The focus is on evaluating DLT’s capability to streamline euro-denominated issuances and delivery-versus-payment (DvP) transactions, which are crucial for the smooth functioning of financial markets.
Collaboration with Industry Leaders
Clearstream, a central securities depository and part of the Deutsche Börse Group, is the only CSD participating in the first wave of these ECB trials. By bringing its digital post-trade platform D7, enhanced with DLT capabilities, into the trials, Clearstream aims to demonstrate how tokenized securities can be effectively managed within the DLT framework.
Clearstream’s participation in the ECB trials is a significant milestone in our digitisation journey: we are expanding our D7 digital securities infrastructure with DLT components and fostering connections with the main digital payment solutions across the Eurosystem. We are thrilled to further collectively shape the future of an inter-connected digital European settlement landscape together with the ECB and our broad participant base. Of course, Clearstream will leverage the trial insights to further enhance D7 for the industry.
Jens Hachmeister – Head of Issuer Services & New Digital Markets at Clearstream The ECB trials are a great step towards integrating DLT into the European financial ecosystem, potentially leading to more transparent, efficient, and secure transaction processes. By connecting with central banks’ digital offerings like the Bundesbank’s Trigger Solution and Banca d’Italia’s TIPS Hash-link, the trials also pave the way for greater interoperability and innovation within the sector.
