ICMA welcomes expansion of Eurosystem initiative to settle DLT-based transactions in central bank money
20 February 2025 The International Capital Market Association (ICMA) welcomes the decision by the Governing Council of the European Central Bank (ECB) to expand its initiative to settle transactions recorded on distributed ledger technology (DLT) in central bank money.
Read the full press release on the ECB’s website.
ICMA and its DLT Bonds Working Group have consistently highlighted the critical importance of a wholesale CBDC (or DLT-based real central bank money settlement solution) and have long advocated for it, as a way of realising the benefits and fostering the market development of DLT-based securities.
We believe the benefits include:
- Next level automation through programmability, reducing costs and fragmentation.
- More efficient securities settlement and post-trade processing, reducing settlement fails and risk.
- Increasing the attractiveness of capital markets and facilitating the funding for the real economy.
- Future proofing and maintaining control of the currency in light of the proliferation of ‘stablecoins’.
We are pleased to see that the ECB’s announcement addresses our members’ key considerations. Collaboration with the industry, notably on harmonisation and standardisation, remains of paramount importance to avoid market fragmentation, and we look forward to engaging further with the Eurosystem and all relevant stakeholders.
Further information on ICMA’s DLT Bonds Working Group as well as guidance on tokenisation and DLT-based debt securities can be found here.
