Last Thursday Europe’s Target2 (T2) and Target2 Securities (T2S) interbank payment systems went down throughout normal business hours. The European Central Bank extended operating hours until midnight, as the system only came back online at 18:00, when the real time gross settlement (RTGS) would usually be taking its last instructions. It’s a relatively rare failure, but not unheard off – another outage of similar scale happened in October 2020.
There was one critical difference. The 2020 outage was on a slow Friday afternoon. This year’s was the day before month end, a busy time for both mainstream payments and securities settlement.
If there were a wholesale central bank digital currency (wCBDC) system, similar to the Banque de France’s DL3S, would that help to provide redundancy? At this stage our analysis is only ‘maybe’ and it will take a while.
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