ECB Exploring Distributed Ledger Technology for Interbank Settlements

The European Central Bank (ECB) is looking at "the potential" of distributed ledger technology (DLT) in improving the efficiency of interbank settlements, said Fabio Panetta, a member of the executive board at the ECB. CBDC, which are typically framed as a new type of DLT-based central bank digital currency that can be used exclusively for settling interbank transfers, have actually existed for decades according to Panetta. "But wholesale CBDC is not synonymous with DLT, as it can be based on any digital technology. DLT can enable the instant settlement of transactions in a wider range of assets around the clock with a broader spectrum of participants, potentially including non-financial corporations."