Pontes goes live as Europe’s infrastructure for tokenised finance
The Eurosystem connects DLT platforms to central bank money
On 21 September 2026, the Eurosystem launched Pontes, a solution that allows transactions in tokenised assets to be settled in central bank money in Europe’s wholesale markets. The launch responds to a need identified during the 2024 trials, when market participants said that access to a settlement asset free from the credit risk of a private issuer was essential to the market’s development. Thirteen market participants, including Deutsche Bank, Santander, Société Générale and the European Investment Bank, and four DLT platform operators had completed onboarding by the launch date; the Deutsche Bundesbank had also joined as a market participant. On the same day, the European Central Bank (ECB) announced preparatory work to invest a small portion of its own funds in tokenised securities, with transactions to be settled through Pontes.
For a seller, the safety of a transaction depends both on the coordination of delivery and payment and on the nature of the money received. Stablecoins and tokenised deposits may be used in these emerging markets, but they are liabilities of private issuers and carry risks linked to those issuers’ ability to meet their obligations. Pontes makes central bank money available to DLT platforms. It remains the benchmark settlement asset for wholesale transactions because its value does not depend on the solvency of a commercial bank or token issuer. Market platforms can therefore adopt tokenisation while retaining access to the money used for final settlement between financial institutions.
How Pontes works
Pontes connects DLT platforms to TARGET Services, the Eurosystem’s infrastructure for payments, securities settlement and collateral management. T2, one of those services, is the system in which participants settle payments in central bank money in real time. When a bond is transferred on a distributed ledger, its delivery must be coordinated with payment even if the two take place on separate systems. Delivery versus payment is an established principle in conventional infrastructure, including TARGET2-Securities, the Eurosystem’s securities settlement platform. Pontes extends it to transactions involving market DLT platforms and Eurosystem systems.
The initial solution gives participants two ways to settle the cash leg in central bank money. They can use cash tokens on a DLT platform operated by the Eurosystem, moving liquidity from their T2 accounts into dedicated wallets, or settle the payment directly on their T2 accounts. The first option provides a tokenised representation of liquidity for use during the operating day; the second connects the platform holding the security directly to T2 cash accounts. In both cases, legal finality for the cash leg remains anchored in T2 during the initial phase. With cash tokens, the corresponding movement on T2 accounts takes place when liquidity is transferred back from the dedicated wallets or at the end of the business day.
Pontes uses the Hash-Link protocol to coordinate the two legs of the transaction. The market platform locks the transfer of the security and releases it to the buyer only when payment in central bank money has been confirmed; if payment fails, the security is not delivered. The DLT platform holding the security applies its own rules to determine when the asset transfer becomes final, while Pontes governs settlement of the cash leg. Synchronisation enables delivery versus payment across separate infrastructures, provided their operational and legal rules are compatible.
Tokenisation can simplify the lifecycle of a financial instrument by bringing issuance, trading, settlement, custody and servicing closer together and automating some processes that currently rely on separate systems. Connecting those activities to payments in central bank money addresses one of the constraints identified in the trials, without requiring the securities and the money to reside on the same platform.
Who can use Pontes
Pontes is designed for wholesale transactions, so market participants must have access to T2 under the TARGET Services rules. Eligible platform operators include authorised central securities depositories, operators of settlement systems or trading and settlement systems authorised under the EU’s DLT Pilot Regime, overseen payment system operators established in the EU or European Economic Area, and central counterparties authorised under the European Market Infrastructure Regulation (EMIR). Banks, investment firms, market operators and other licensed financial institutions may also qualify if they are subject to specific supervision as market infrastructures or are assessed individually by the relevant national central bank. The thirteen participants and four DLT operators onboarded at launch form the service’s initial group of users. Access remains limited to eligible institutions; Pontes does not introduce a new means of payment for the public.
The ECB prepares to invest in tokenised securities
By beginning preparations to buy tokenised securities, the ECB has added the prospect of using Pontes as an investor to the launch of the settlement service. Purchases would account for a small portion of its own funds portfolio and would initially focus on euro-denominated securities issued by euro area governments, public agencies and European supranational institutions. The portfolio is separate from monetary policy, and the transactions would be settled in central bank money through Pontes. The ECB aims to gain experience across the investment process, from trade execution and settlement to systems and portfolio management. Its Executive Board will decide the operational details and timing after the preparatory work, taking account of the supply of eligible tokenised securities.
If the ECB becomes a buyer, its participation could help address a familiar challenge for emerging markets: issuers need investors and usable infrastructure, while investors need securities to buy, clear rules and sufficient liquidity. A small allocation would not, on its own, create regular trading between market participants. Since 30 March 2026, the Eurosystem has also accepted certain securities issued through DLT-based services at central securities depositories as collateral, subject to its existing eligibility rules. For now, these securities must be available for settlement in eligible systems accessible through TARGET2-Securities; broader acceptance of assets issued and settled entirely on other networks remains under review. The settlement service, the ECB’s possible role as an investor and collateral eligibility thus address different parts of the same market.
The limits of the initial phase
According to the ECB’s operational documentation, Pontes initially follows the T2 business calendar: preparatory activities run from 08:00 to 09:00, and transaction settlement is available from 09:00 to 16:00. This window limits the continuous use of technology that could operate beyond the banking day, while legal finality for the cash leg on the Eurosystem DLT platform still depends on the corresponding movement in T2. The ECB plans to expand Pontes’s functions and operating hours gradually, with full implementation expected by 2028. Continuous availability and greater programmability of central bank money therefore remain for later stages.
For connections between infrastructures to support an integrated market, securities must be issued, held and transferred under compatible rules, with investors’ rights remaining clear as assets move between platforms. The market also needs liquidity providers, workable collateral arrangements and certainty about when transfers become final. Pontes addresses settlement in central bank money, but transaction volumes will also depend on the growth of issuance and the development of these other parts of the market.
The path to Appia
Experience with Pontes will feed into Appia, the Eurosystem programme examining how tokenised platforms could operate within an integrated European market. The options under consideration include a shared network and multiple interoperable ledgers. Either approach will need common rules for transferring securities and the rights attached to them between platforms, managing collateral and ensuring settlement finality. Appia is expected to deliver a broader blueprint by 2028, informed by problems encountered in the use of Pontes. The choices made for the longer-term architecture will, in turn, guide the service’s evolution.
Conclusions
Pontes gives financial institutions a way to settle transactions in central bank money without requiring cash and securities to be held on the same platform. Its availability, however, says little about how much it will be used or whether the benefits will justify changes to market infrastructure. Initial onboarding shows interest; sustained issuance, settlement volumes and trading liquidity will show whether the connection can support a self-sustaining market. The first test is whether a working infrastructure becomes part of regular market activity, while Appia will need to address the problems Pontes leaves open when securities move between platforms.
