The European Central Bank (ECB) is actively exploring how blockchain technology can reshape financial infrastructure and reinforce its central role in the euro area’s monetary system. Isabel Schnabel, a member of the ECB’s Executive Board, emphasized this strategic shift during her speech at the Jackson Hole symposium in the United States — a high-profile annual gathering of global central bankers and economists.
Why ‘Going On-Chain’ Matters
Schnabel argued that central banks must ‘go on-chain’ — meaning they need to integrate central bank money directly into blockchain-based systems. This move isn’t about chasing technological trends; it’s about ensuring that public money remains the bedrock of financial settlement as markets increasingly adopt digital assets and distributed ledger technologies. With stablecoins and other private digital currencies gaining traction, the ECB sees blockchain integration as essential to preserving monetary sovereignty and policy effectiveness.
Programmable Money and Policy Innovation
One of the most consequential implications highlighted by Schnabel is the programmability of transactions on blockchain platforms. Embedding rules directly into payment infrastructure could allow central banks to automate certain monetary operations — such as applying differentiated interest rates or enforcing collateral requirements in real time. This capability opens new avenues for implementing monetary policy with greater precision and efficiency.
ECB’s Ongoing Projects: Pontes and Appia
The ECB is already advancing concrete initiatives. Schnabel referenced two key projects: Pontes and Appia.
Pontes focuses on bridging existing Eurosystem payment systems — like TARGET2 — with emerging blockchain platforms. Its goal is to enable seamless settlement of tokenised assets using central bank money, thereby maintaining the integrity and safety of final settlement while embracing innovation.
Appia, meanwhile, is a forward-looking effort to design the long-term architecture and regulatory framework needed to support a robust, interoperable ecosystem for tokenised financial markets across Europe.
Building the Right Infrastructure
Schnabel noted that multiple technical pathways are under consideration — from developing a unified European blockchain to interconnecting disparate ledgers across jurisdictions. Whichever path is chosen, she stressed that central banks themselves must become active participants in these digital infrastructures: ‘To fully harness the benefits, central banks must go on-chain themselves.’ In her view, central bank money must be natively embedded in the digital financial architecture that will define Europe’s future markets.