Pontes: The EU Bridge Between Tokenized Assets and Central Bank Money

Europe's tokenized economy has been building real momentum, with new issuances of tokenized bonds, equities and funds arriving steadily. As that activity grows, one practical question keeps surfacing: when a tokenized asset changes hands, what settles the cash side of the trade? The European Central Bank has given its answer a name — Pontes, Latin for "bridges." And a bridge is exactly what it is meant to be.

What is Pontes?

Pontes is the Eurosystem's distributed ledger technology (DLT) solution that links market DLT platforms, such as Token City's upcoming Trading and Settlement System, with TARGET Services, the ECB's core settlement infrastructure, so that DLT-based transactions between regulated institutions can settle in central bank money.

In plain terms: when a tokenized security moves on a blockchain, Pontes lets the corresponding payment settle in the safest form of money there is — money issued by the central bank itself, the same asset that already underpins Europe's interbank settlement today.

Pontes sits within a single Eurosystem programme dedicated to bringing DLT and tokenization into Europe's wholesale financial markets. The ECB approved the strategy in July 2025 as a two-track plan: Pontes is the near-term track that brings a working solution to market quickly, while a second track, Appia, looks further ahead at a more deeply integrated, longer-term ecosystem.

Built on real-world testing

Pontes did not appear from a blank page. Its design draws directly on the Eurosystem's exploratory work carried out between May and November 2024, when 64 participants from across the industry ran more than 50 trials and experiments with central bank money settlement on DLT. That hands-on feedback shaped the features Pontes now brings together, which is why the project arrives grounded in what market participants said they actually needed.

How it will work

Pontes is designed around a dual-settlement model, giving participants two complementary ways to settle the cash leg of a transaction. To understand what that means, it helps to know what T2 is: T2 is the Eurosystem's existing payment system, the backbone that moves large-value euro payments between banks every day. When a bank pays another bank in central bank money, the transfer goes through T2. It is the settlement engine that already underpins the euro area's financial plumbing.

With Pontes, participants will be able to settle the cash side of a tokenized trade in one of two ways:

• On the Eurosystem DLT platform, using digital tokens that represent central bank money, or
• In T2, the system described above.

In both cases, the transaction is finalized once it is recorded in T2. That step is what gives every settlement the same legal certainty and robustness that the existing euro payment system provides today — the new DLT layer plugs into the proven backbone rather than replacing it.

The link between the two sides is what makes the model work in practice. A reliable interoperability mechanism allows the tokenized asset and the cash to move at the same time, conditional on each other — known in finance as delivery-versus-payment, or DvP. If one leg fails, the other does not happen. That eliminates the risk of one party handing over the asset and not receiving payment, or vice versa. The whole process is designed to run end-to-end with minimal manual intervention, with the DLT layer and T2 talking to each other smoothly.

The Eurosystem plans to launch the Pontes pilot in the third quarter of 2026, starting with a focused initial version and limited operating hours. Improvements will follow step by step, with an enhanced version expected by 2028 that is designed to operate around the clock. The ECB is also finalizing the eligibility criteria for assets, market participants and DLT operators that will take part in the pilot.

What Pontes aims to achieve

The ECB frames the project around a clear set of goals:

• Support market needs and innovation, giving tokenized markets a settlement asset they can build on.
• Preserve the pivotal role of central bank money as the safest means of settlement, keeping it available even as transactions move onto new technologies.
• Keep the Eurosystem relevant amid rapid technological and financial change.
• Strengthen the EU's strategic autonomy and advance the broader vision of a digital capital markets union and a savings and investments union for Europe.

Taken together, these goals point in one direction: making sure that as more of Europe's financial activity moves onto distributed ledgers, the foundation underneath it stays as solid as the one markets rely on today.

Why it matters for tokenization in Europe

Tokenization has, until now, advanced on two fronts. The legal side came first — frameworks such as MiCA and the EU's DLT Pilot Regime gave issuers and platforms a regulated path. What Pontes adds is the settlement rail: a trusted, risk-free way to settle the cash side of a tokenized trade directly in central bank money.

With central bank money available on-chain through Pontes, a buyer can receive a tokenized bond and the seller can receive risk-free cash in a single, atomic step. That is the kind of settlement certainty institutional investors expect, now extended to the world of tokenized assets.

The ECB has been laying complementary groundwork too. Since the end of March 2026, the Eurosystem has accepted marketable assets issued on DLT through central securities depositories as eligible collateral for its credit operations — another signal that tokenized instruments are being woven into the core of European market infrastructure.

For the wider ecosystem, Pontes offers a common anchor. Issuers gain confidence that tokenized instruments can settle against the safest asset available. Platforms gain interoperability with the infrastructure that already moves trillions across Europe. And investors gain the settlement assurance that helps a market scale.