The European Central Bank (ECB) plans to allocate a “limited share” of its personal capital toward tokenized government-backed assets.
These transactions will be cleared using central bank currency via Pontes, which is the Eurosystem settlement platform for distributed ledger technology transactions that debuted on Monday.
In a distinct statement released Monday, the ECB explained that this project will grant them direct insights throughout the entire investment duration, covering trade fulfillment, clearing, operational platforms, and asset administration.
Acquisitions will stem from an asset pool outside monetary policy that yields returns to assist with funding the central bank’s day-to-day administrative costs.
At the start, holdings will center on euro-denominated bonds created by eurozone national and local administrations, governmental entities, and European cross-border organizations.
The scheduling and execution specifics will be finalized by the ECB’s Executive Board once preliminary tasks are finished.
The European Stability Mechanism noted in a Monday press release that Pontes will link modern DLT networks with traditional central bank systems, ensuring that central bank currency maintains its function as the primary settlement medium as financial sectors grow increasingly tokenized.
Related: ECB defends digital euro privacy as CBDCs face global scrutiny
Originally published at https://cointelegraph.com/news/ecb-money-tokenized-securities-pontes?utm_source=rss_feed&utm_medium=rss&utm_campaign=rss_partner_inbound.
