Tokenization & RWA
Over the past two years, tokenised private equity and structured debt have repeatedly been presented as the next asset class ready to move onto blockchain, after real estate.
The promise was always the same: fractional access, greater efficiency, the potential to develop secondary markets, and lower intermediation costs.
The problem, though, was never really the token technology.
It was what happened after the trade: settlement.
A private equity fund or a structured debt issuance doesn’t move on the promise of future liquidity. For an institutional market, what matters just as much is the certainty with which assets and cash are exchanged and settled.
That is where tokenisation has run into one of its most significant limitations so far.
From experimentation to infrastructure
On 21 September, the Eurosystem brought Pontes into production, the DLT infrastructure that connects market platforms to TARGET Services and enables DLT-based transactions to settle in central bank money.
This was not a standalone initiative. The approach builds on exploratory work carried out by the Eurosystem between May and November 2024, when 64 participants conducted more than 50 trials and experiments to test the use of DLT for wholesale settlement in central bank money.
Pontes builds directly on the outcome of that work.
Nor is it a new rule, and it doesn’t replace the regulatory perimeter governing the issuance or trading of a financial instrument.
It is settlement infrastructure.
The distinction matters.
Pontes operates below the issuance level. It links the transfer of the digital asset to the cash leg settled in central bank money and enables the synchronisation needed for Delivery-versus-Payment operations and other transactions requiring all-or-none execution.
The legal finality of the cash leg, in the initial setup, remains anchored to T2. From there, the Eurosystem plans to evolve Pontes progressively, adding further functionality and ultimately moving towards round-the-clock availability.
Why operating hours matter
Operating hours are not a minor technical detail.
The Eurosystem has recently completed a public consultation on extending T2 operating hours, receiving 125 responses from organisations across 19 countries.
The primary driver identified by the consultation was the need to improve liquidity management for instant payments, while longer operating hours could also support services such as Pontes, which is ultimately intended to operate around the clock, as well as a potential digital euro.
The signal from the market is clear: financial infrastructure increasingly needs to operate on timelines that are very different from those of traditional market systems.
Who is already involved
The first four DLT operators registered for the initial launch are Clearstream, SWIAT, Cashlink and Axiology.
The mix is worth noting, since it includes both established infrastructure providers and operators native to the DLT market.
Pontes is, in fact, one of two tracks planned by the Eurosystem.
It is the solution designed to address the market’s near-term needs, and one that will be expanded progressively.
Appia looks further ahead: by 2028, it is expected to produce a blueprint for a more integrated tokenised financial ecosystem in Europe. Its final architecture has not yet been determined.
What Pontes changes, and what it doesn’t
Operationally, Pontes doesn’t mean that any issuer can connect directly to the ECB.
Access follows specific criteria. In the initial phase, market participants need access to T2, while DLT operators must fall within the categories admitted by the Eurosystem.
For an issuer, this means being able to place a project within an infrastructure where digital assets and central bank money can be linked through eligible operators and participants, without having to build a parallel monetary system.
For tokenised private equity and structured debt, this changes one specific part of the risk calculation.
Settlement in central bank money reduces exposure to the credit and liquidity risks inherent in private forms of settlement and provides a common anchor with the traditional financial system.
This doesn’t mean Pontes removes the risks of tokenisation.
The legal qualification of the instrument, distribution, custody, KYC/AML, corporate actions, secondary-market liquidity, interoperability and fragmentation across platforms all remain.
The ECB itself is clear on this point: access to central bank money is a prerequisite for DLT-based financial markets to scale safely and develop, not a solution to every other layer of the market.
This is probably the most interesting part.
Pontes isn’t trying to solve tokenisation with another token.
It brings one component of the new infrastructure inside the perimeter of European financial market infrastructure.
What this means for tokenisation infrastructure
For those of us building tokenisation infrastructure for the regulated European market, this confirms a design choice we have held from the start: issuance, legal qualification, distribution and settlement cannot be designed as independent elements.
In our model, ABTK remains a utility token for access and use, with no economic rights over the underlying activity.
Tokenising instruments that carry financial rights belongs to a separate perimeter, one where the qualification of the instrument and the services actually provided determine how financial regulation applies and, where necessary, which authorised entities need to be involved.
These are two levels that shouldn’t be confused.
The direction the Eurosystem has taken with Pontes is concrete: the infrastructure needed to connect tokenised markets to central bank money is entering the European financial system.
And the market is already asking that infrastructure to go further.
The token was always the easy part.
The hard part was always what happens a second after the trade.
Pontes doesn’t solve tokenised private equity.
It solves one of the problems that has limited its ability to scale: connecting the digital asset to settlement infrastructure in central bank money.
