ECB Member Says Central Bank Currency Needs to Be Tokenized
Isabel Schnabel, a member of the Executive Board of the European Central Bank, stated at the Jackson Hole Economic Policy Symposium that central bank reserves are superior to stablecoins and serve as ultimate settlement assets, emphasizing that central banks must place reserves on-chain. She pointed out that stablecoins lack the ability to rapidly expand liquidity during financial stress. Schnabel stressed that tokenization can enhance the speed, security, and programmability of financial transactions, but it requires central bank currencies to operate on the same infrastructure as other tokenized assets. The ECB's Pontes project is set to launch in September 2026, initially connecting TARGET services with market participants' DLT platforms. The project will subsequently support direct settlements on the DLT platform of the euro system and gradually incorporate smart contract functionalities for round-the-clock operations. The Appia project will be responsible for establishing the long-term architecture, technical standards, and legal framework for the European tokenized asset market, with a complete blueprint expected by 2028.
-- Price
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