Cipollone urges T+1 readiness as tokenised settlement expands
European Central Bank (ECB) Executive Board member Piero Cipollone urged firms to intensify testing for Europe's move to next-day securities settlement on October 11, 2027. He linked the transition to modernising infrastructure and expanding tokenised finance.
One day demands faster processes
T+1 cuts settlement from two days to one, reducing market and counterparty risk while requiring greater standardisation and automation.
The ECB, European Securities and Markets Authority and European Commission support preparations.
TARGET2-Securities (T2S) already handles T+1 and T+0 transactions; night-time process changes are planned for June 2027.
Pontes has connected market distributed ledger technology (DLT) platforms to TARGET Services since September 21, enabling tokenised transactions to settle in central bank money.
Operating hours will expand by mid-2027, with 24/7/365 availability planned for 2028.
Immediate settlement finality on the Eurosystem DLT platform is planned as early as 2027.
Cipollone urged continued implementation and testing.
Collateral and a common blueprint
Since March 30, the Eurosystem has accepted marketable assets issued in DLT-based central securities depositories as collateral.
It is assessing eligibility for DLT assets outside currently eligible settlement systems, while preserving collateral adequacy.
Appia aims to deliver a blueprint for an integrated European tokenised finance ecosystem by 2028.
The October 28 consultation report found broad support for an ecosystem anchored in central bank money and willingness to contribute, supporting a public-private partnership.
Coexistence, not replacement
Cipollone said T2S will continue serving securities markets alongside tokenised platforms.
The Eurosystem sees its tokenisation strategy as complementary to existing TARGET Services.
Its stated challenge is interoperability without recreating fragmentation in digital form.
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