Clearstream Joins ECB's Trials of Digital Euro CBDC, Embraces Tokenized Securities
Summary:
Clearstream, a subsidiary of Deutsche Börse Group, will participate in the ECB's trials of a digital euro CBDC. It will use distributed ledger technology for transactions with tokenized securities, linking to Deutsche Bundesbank, Banca d'Italia, and Banque de France's products. Clearstream's euro-denominated issuances and delivery-versus-payment transactions will be tested from May to November. The firm, which manages over 18 trillion euros in assets, previously participated in SWIFT's CBDC and tokenized asset experiments in 2022. The market for tokenized securities, meanwhile, is rapidly expanding.
Clearstream, a subsidiary of Deutsche Börse Group which serves as a central securities depository (CSD), will participate in the European Central Bank's (ECB) exploration of a wholesale central bank digital currency (CBDC) as a potential form of digital euro. Clearstream, the sole CSD involved in the ECB's preliminary phase, manages the D7 post-trade platform, the LuxCSD located in Luxembourg, alongside a German CSD and an international one. Clearstream's head for digital issuer services and new markets, Jens Hachmeister expressed that the company aims to extend their D7 digital securities system by incorporating distributed ledger technology (DLT) and enhancing connectivity with leading digital payment solutions across the Eurosystem. They collaborated with Google Cloud to enhance D7's capabilities and plan to scrutinize the application of distributed ledger tech for wholesale transactions with tokenized securities. This endeavor includes establishing connections with three products offered by European central banks, namely Deutsche Bundesbank's Trigger Solution, Banca d’Italia's TIPS Hash-link, and Full DLT Interoperability offered by Banque de France. Clearstream will carry out euro-denominated issuances and DVp transactions across various business cases and payment methods, with tests conducted between May and November using actual central bank funds. Following a two-year probe phase, the ECB initiated the setup phase for its digital euro research in October, recognizing vendors in January. Both Banca d’Italia and Deutsche Bundesbank began their journey with corresponding DLT tech in 2021, with Banca d’Italia signing a MOU with the Bank of Korea to delve into settlement systems and CBDC by the close of 2023. With over 18 trillion euros worth of assets under its supervision, Clearstream was involved in SWIFT's CBDC and tokenized asset trials in 2022. Any plans of launching a digital euro will only be solidified once the ECB's trials are over, and the relevant regulations are established. Lastly, the market for tokenized securities is booming, with the market for tokenized U.S Treasury bonds in the U.S soaring from $114 million to $845 million in the past year.
Published At
4/8/2024 11:34:08 PM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.