In a guest lecture, ECB Executive Board member Piero Cipollone set out the Eurosystem’s strategy to keep central bank money “fit for purpose” as payments and finance digitalise, framing this around a public-private partnership across retail, wholesale and cross-border payments. The lecture argues that the ECB should provide a Europe-wide public anchor in digital form through a digital euro, central bank money settlement for DLT-based wholesale transactions and expanded interlinking of fast payment systems. The speech highlights three challenges driving the approach: persistent fragmentation and reliance on non-European providers in retail payments, the risk of fragmentation and foreign-currency settlement assets in tokenised finance without tokenised central bank money, and slow and costly cross-border payments amid growing interest in stablecoins. For retail payments, the digital euro is presented as a legal tender “digital equivalent of cash” intended to be accepted across the euro area for digital use cases, including an offline functionality with cash-like privacy, while keeping banks at the centre of distribution and introducing safeguards such as non-remuneration and holding limits. For wholesale markets, Cipollone reiterated the Governing Council’s July approval of a dual-track approach, with Project Pontes intended to offer a regular service for settling DLT transactions in central bank money as early as the third quarter of 2026, and Project Appia to explore a longer-term tokenised ecosystem, with a launch paper due in early 2026. On cross-border payments, the lecture points to TIPS’s expanding role, including cross-currency payments between the euro area, Sweden and Denmark since October 2025, work to connect TIPS with India’s Unified Payments Interface and Nexus Global Payments, and support for a multi-currency “TIPS clone” in the Western Balkans that is due to become operational in July 2026. Next steps referenced include the Pontes service launch in the third quarter of 2026, the Appia launch paper in early 2026, a planned 2027 pilot for banks in a simulated digital euro ecosystem, and the July 2026 go-live of the Western Balkans instant payments system modelled on TIPS.
European Central Bank 2025-12-08
European Central Bank outlines digital euro, Pontes Appia DLT settlement timeline and TIPS cross-border interlinking
ECB Executive Board member Piero Cipollone outlined the Eurosystem's strategy to adapt central bank money for digital finance, emphasizing a public-private partnership across retail, wholesale, and cross-border payments. Initiatives include a digital euro, DLT-based wholesale transaction settlement, and expanded interlinking of fast payment systems. Challenges include fragmentation in retail payments, risks in tokenised finance, and inefficiencies in cross-border payments.