ECB Plans Direct Investment In Tokenized Securities Using Pontes

TL;DR The ECB has started preparatory work to invest a small portion of its own-funds portfolio in tokenized euro-denominated securities. Initial eligible assets are expected to include euro-area public-sector and supranational issuers. The future purchases are intended to settle in central-bank money through Pontes; purchases have not yet been executed. The European Central Bank is moving from building tokenized-settlement infrastructure to preparing to use it for part of its own investment portfolio. The ECB said on September 21 that it has begun preparatory work to invest a small portion of its own-funds portfolio in tokenized euro-denominated securities. ECB Prepares To Become A Direct Buyer The plan is separate from monetary policy. The own-funds portfolio is a non-monetary-policy pool, and the initial investment universe is expected to focus on euro-area central governments, regional governments, agencies and European supranational issuers. The especially notable part is how those trades are intended to settle. The ECB plans to use Pontes, the Eurosystem’s newly launched infrastructure for settling tokenized financial assets in central-bank money. That means the central bank ...