New ECB initiative aims to integrate DLT with existing financial infrastructure.
ECB Pushes Forward with DLT-Based Settlements
The European Central Bank (ECB) has announced a new step in its plan to settle transactions recorded on distributed ledger technology (DLT) using central bank money. The initiative will be implemented in two phases: first, developing a platform for DLT settlements while ensuring interoperability with TARGET Services, and second, exploring a long-term integrated solution for DLT-based settlements, including foreign exchange transactions.
Balancing Innovation with Stability
ECB Executive Board member Piero Cipollone emphasized the importance of innovation without compromising financial stability. He noted that the move aligns with the ECB’s broader efforts, including the development of a digital euro as a secure form of digital payment.
Strengthening Europe’s Digital Asset Market
This initiative builds on previous ECB-led experiments involving 64 participants, including central banks and DLT platform operators. It also supports the creation of a digital capital markets union to foster the growth of digital asset markets across Europe.
Implications for the Crypto Space
While the ECB explores DLT for settlements, some experts speculate that European central banks could begin accumulating Bitcoin, signaling an evolving stance toward digital assets.
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