When a German pharmaceutical company issued a US dollar bond on a Thursday with T+5 settlement and then dropped a profit warning over the weekend, asset managers who had subscribed were stuck. They could not sell. They could not hedge. They just had to wait. That kind of story, shared by Union Investment’s Christoph Hock at the Digital Euro Conference on Thursday, is the sort of concrete pain point that distributed ledger and Europe’s wholesale CBDC (wCBDC) infrastructure is supposed to address.
But with the ECB’s Pontes platform launching in Q3 and a 90-page draft service description published this week, the panel discussion revealed a telling split. The buy side representatives from Union Investment and KfW came armed with specific examples of what tokenized settlement could solve. SIX’s Marco Kessler, whose firm operates market infrastructure in both Switzerland and Spain and has enabled a pilot wCBDC in Switzerland, struck a more cautious note. He pressed the question of whether the market is ready to build compelling use cases on top of the new rails.
The Banque de France’s Adeline Bachellerie, meanwhile, confirmed that the Eurosystem has no plans to expand the existing access policy for central bank money. Wholesale CBDC is central bank money, she said, and the eligibility criteria will not change. For some asset managers that lack direct Target 2 access, that means the benefits of wholesale CBDC will flow indirectly through tokenized deposits held with custodian banks.
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