Interoperability, not issuance, is the bottleneck, says ECB paper—plus market reaction

The European Central Bank has warned that Europe’s tokenisation push will stall unless the industry solves interoperability, arguing in its latest Macroprudential Bulletin that the real friction sits after issuance, where today’s DLT platforms remain siloed and secondary‑market liquidity is thin.

The paper highlights that most efficiency gains — atomic settlement, shared data models, automated lifecycle events—depend on central bank money being available on DLT and on infrastructures being able to talk to each other.

That analysis aligns with the Eurosystem’s two major workstreams. Pontes, due later this year, will allow wholesale DLT transactions to settle in central bank money for the first time, while Appia sets out a longer‑term roadmap for a European shared ledger and how it could coexist with T2S rather than replace it. Together, they mark a shift from pilots to ecosystem design, with the ECB positioning interoperability, consistent data models and integrated cash‑asset movement as the foundations of future post‑trade architecture.

Market reaction

Richard Baker, founder and CEO of Tokenovate, said the ECB was right to focus on the post‑trade layer, where most of today’s friction remains. He noted that tokenisation efforts have often prioritised creating digital assets rather than redesigning how they move, settle and synchronise across systems. For him, the real breakthrough comes when cash and assets move together, and when every participant shares the same event model, reducing reconciliation and enabling straight‑through processing. Until that alignment is achieved, he warned, tokenised markets will remain confined to controlled pilots rather than scaling into mainstream liquidity.

Baker adds that shared models such as the Common Domain Model and approaches like Digital Regulatory Reporting come into play. They give firms a way to describe a trade and its lifecycle in the same way, so systems don’t need to reinterpret or rebuild the event at each step. In practice, that’s what allows processes to run without constant intervention.