In effect, the European Central Bank (ECB) is setting out a now, next, later progression for central bank money in settlement. TARGET2-Securities (T2S) carries Europe into T+1 without starting from scratch, Pontes extends TARGET Services to DLT, and Appia points to an integrated tokenised ecosystem built as a public-private partnership, Executive Board member Piero Cipollone said.
Speaking by video link at Citi’s “T+1: one year to go” event last Thursday, hosted for the EU T+1 Industry Committee, Cipollone cast the move to one-day settlement on 11 October 2027 as part of a wider push to make Europe’s financial infrastructure safer, more resilient and more efficient. But he used it as a jumping-off point to argue that the Eurosystem’s settlement capabilities already exist and, through collaboration, can underpin tokenised finance, so the task is making today’s infrastructure and tomorrow’s work together, not choosing between them.
T2S: public and private, not starting from scratch
The T+1 project shows “what Europe can achieve when public authorities and private sector come together around a common objective”, he said, but the work is not finished. “The coming months will be critical,” and implementation and testing must advance “with the same determination and cooperation” that have driven the project so far.
The Eurosystem’s contribution is T2S, its platform for settling cash and securities in central bank money. Because T+1 makes inefficiencies “much more difficult to sustain”, the Eurosystem is adapting T2S processes for the tighter timetable, including changes to night-time settlement planned for June 2027. T2S already supports a shorter cycle and has settled substantial volumes on T+1 and T+0 bases. “So we are not starting from scratch,” he said.
Pontes: bridging to tokenised settlement
Tokenisation could bring issuance, trading, clearing, settlement, custody and asset servicing into a shared digital environment, Cipollone said, and the Eurosystem intends to be part of that transformation.
Since 21 September, Pontes has connected market DLT platforms to TARGET services, allowing tokenised wholesale transactions to settle in central bank money. The Eurosystem will extend operating hours by mid-2027 and move to 24/7/365 availability in 2028. It also plans immediate settlement finality on its DLT platform as early as next year.
Appia: the longer-term blueprint
Appia looks further ahead, aiming by 2028 to deliver a blueprint for a safe, integrated European tokenised ecosystem. A consultation report published the day before his speech showed broad market support for a framework anchored in central bank money, and willingness among respondents to contribute. That, he said, gives a strong basis to develop Appia as a public-private partnership.
Coexistence, not a choice
“T2S is not going to disappear anytime soon,” Cipollone said. Different technologies will coexist because they suit different use cases, and the Eurosystem’s tokenisation strategy “complements” its work to modernise existing TARGET services.
“We should not frame the discussion as a choice between today’s infrastructure and tomorrow’s technology. The real challenge is to enable them to coexist,” he said. Innovation should help Europe overcome fragmentation, not “recreate that fragmentation in digital form”.
T2S, PONTES and Appia may look like separate initiatives, he concluded, but “they are connected by a common purpose”: a robust, resilient, efficient and innovative infrastructure on which an integrated European market can develop.