Blockchain for Banking News

Eurosystem opens call for DLT payment trial participants. Includes non-banks

digital euro cbdc currency wholesale DLT payments

Yesterday the Eurosystem launched its call for participants for wholesale settlement trials for DLT networks using central bank money. The aim is to provide central bank money to settle delivery versus payment transactions involving DLT-based digital securities. The set of potentially eligible participants is reasonably broad. 

There will be two waves of trials with the applications for the first wave required by 31 January 2024 and the second wave by 30 April 2024. However, the deadline to submit questions is 12 January.

Potential participants include: 

  • banks or institutions with access to the TARGET payment system 
  • qualifying central securities depositories
  • operators of platforms that include settlement under the DLT Pilot Regime
  • and some other licensed institutions operating DLT platforms.

National central banks will assess the latter group on a case-by-case basis.

As previously reported, there will be ‘trials’ using real central bank money and ‘experiments’ which are simulations. The tests involve three solutions. One is Germany’s trigger solution. Another is Italy’s TIPS Hash link solution and the third is a ‘Full-DLT interoperability’ solution from the Banque de France. The French central bank describes its tokens as “exploratory cash tokens” rather than a wholesale central bank digital currency (wholesale CBDC).

The tests include volume limits in terms of number of transactions per day and participants. Germany’s Trigger solution has far higher volume limits for the trials than the other two at 500 delivery versus payment (DvP) transactions. That’s compared to 120 DvP for the French solution and 60 for the Italian one. The Trigger solution is allowed 25 participants per day compared to 12 each for the other two solutions. These limits are based on providing the “service safely, properly and based on a level playing field.” For now there are no value limits, but those may be imposed later.

Tomorrow morning (14 December) there will be a virtual session including demonstrations of the three settlement solutions.

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