Tokenisation: Central Bank of Ireland & Enterprise Ireland webinar

Discussion Paper on DLT and tokenisation

In March 2026, the Central Bank of Ireland(Central Bank) published Discussion Paper 12 - DLT & Tokenisation in Financial Services (Discussion Paper), seeking to open a structured dialogue on the future role of distributed ledger technology (DLT) and tokenisation in the Irish and European financial services ecosystem. The Discussion Paper considers the potential benefits of tokenisation, the key enablers required for it to scale, sector‑specific considerations (including markets, funds and payments), and risks associated with adoption.

For a detailed overview of the Discussion Paper, please see our previous Simmons & Simmons article Central Bank of Ireland opens discussion on DLT and tokenisation | Simmons & Simmons

Central Bank and Enterprise Ireland Webinar

On 30 April 2026, Enterprise Ireland and the Central Bank co‑hosted a webinar exploring the Discussion Paper and the Central Bank's broader thinking on DLT and tokenisation. The session provided insights into the Central Bank's approach to tokenisation and DLT, positioning the discussion within wider EU and international initiatives, and offering practical perspectives beyond the contents of the Discussion Paper.

The Central Bank emphasised that the Discussion Paper is deliberately broad and is intended to inform future engagement on the topics of tokenisation and DLT. With this in mind, the Central Bank placed particular emphasis on industry engagement, encouraging Irish market participants not only to respond to the Discussion Paper, but also to engage actively with it, and identify practical use cases where possible. The Central Bank expects the number of use cases to continue to grow (particularly in the funds, collateral management and settlement sectors), with regulatory frameworks evolving in parallel as market practices develop.

Central Bank approach to innovation

A recurring theme throughout the webinar was the Central Bank's view that innovation and financial stability are not mutually exclusive. Drawing on its broad mandate as a Eurosystem central bank and integrated financial regulator, the Central Bank highlighted its ability to assess tokenisation from a system‑wide perspective, rather than through a single sectoral lens.

Key points highlighted included:

• the Central Bank's engagement model is based on enabling innovation within appropriate guardrails, rather than treating regulation and innovation as inherently in opposition to one another;
• use of innovation tools, such as the Innovation Hub and Innovation Sandbox, with tokenisation identified as a potential future sandbox theme;
• co-ordination with EU and international bodies (including the ECB and ESMA); and
• the Discussion Paper is intended as the beginning of a longer‑term engagement process, rather than a statement of settled or prescriptive policy.

Tokenisation and DLT - Key Themes and Potential Benefits

The webinar addressed how tokenisation and DLT could function in practice and where their value may lie for existing financial services. The Central Bank highlighted a number of themes and potential benefits associated with tokenisation and DLT, while stressing that these remain subject to appropriate governance and safeguards:

• Settlement finality and efficiency - tokenisation may enable more real‑time or near‑real‑time settlement of transactions, with the potential to reduce counterparty risk, intraday exposures and reliance on layered post‑trade processes.

• Programmability - the role of smart contracts is a potentially transformative feature, allowing certain contractual and operational processes (such as settlement mechanisms or corporate actions e.g. dividends, coupons) to be automated.

• Transparency and data availability - shared ledgers may provide more timely and consistent visibility of transactions and ownership, supporting risk monitoring and supervisory oversight.

• Flexibility of use cases - different DLT models (including permissioned and permissionless configurations) may be suited to different financial service activities, depending on governance, access and control requirements.

• Distinction between underlying technology - the Central Bank reiterated that its concerns around retail crypto‑assets as being risky and speculative do not amount to opposition to the underlying technology, which may offer efficiency, transparency and risk‑management benefits for financial services.

The Central Bank also noted that risks associated with tokenisation are not uniformly higher or lower than those in traditional finance. Risks are not eliminated, but rather redistributed across new actors, roles, technologies and interfaces.

Interoperability and standardisation

In terms of interoperability, Central Bank noted that:

• interoperability and standardisation are critical if tokenisation is to reduce, rather than replicate existing inefficiencies in clearing, settlement and custody;
• Ireland's position as a major domicile for funds and payments activity makes fragmentation a particularly relevant concern from a systemic perspective; and
• public sector actors have a role to play in supporting interoperable, shared infrastructures that function for the public's benefit.

Settlement in central bank money

Consistent with the Discussion Paper, the Central Bank stressed the importance of settlement in central bank money as an anchor of trust in a tokenised future. This point was expanded on in the course of the webinar through a discussion of the Eurosystem's ongoing initiatives, including Pontes (a short‑term interoperability solution linking DLT platforms with TARGET services) and Appia (a longer‑term vision for token‑based wholesale settlement infrastructure).

The Central Bank reiterated that while private settlement assets, including authorised stablecoins under MiCAR, may play a role in future market arrangements, central bank money remains fundamental to preserving monetary and financial stability.

Funds and liquidity management

The discussion around funds and liquidity management tools was given a more practical dimension during the webinar:

• reference was made to the growing scale of tokenised MMFs internationally, with approximately €10 billion of MMFs reported as tokenised on‑chain;
• tokenisation was discussed not as a solution to existing look‑through or liquidity management challenges, but as a potential way to operationalise liquidity management tools more effectively;
• the embedding of tools such as swing pricing, redemption gates or notice periods directly into token structures was highlighted as a possible future development; and
• from a supervisory perspective, tokenisation could support more real‑time visibility of investor flows, potentially reducing the reactive nature of liquidity interventions in stressed market conditions.

Q&A highlights

The Q&A session provided further some additional insight into areas of regulatory focus:

• Use of specific blockchains - neither the Central Bank nor Enterprise Ireland has adopted specific blockchain platforms for live projects to date. Instead, the emphasis is on capacity‑building and hands‑on engagement with the technology.
• Stablecoins and MiCAR - while central bank money remains critical for wholesale settlement, authorised e‑money token issuers under MiCAR may play a role in certain settlement or collateral use cases. How this develops was characterised as an evolving area rather than settled policy.
• Prediction markets and oracle risk - oracle risk and the regulatory classification of activities such as prediction markets are active areas of focus, particularly in relation to data integrity, manipulation risks and the regulatory perimeter.

Next steps

The Discussion Paper remains open for responses until 5 June 2026, and the Central Bank has encouraged stakeholders to focus on the questions most relevant to their activities and business models.

How we can help

Our Financial Services Regulation team advises clients across the full spectrum of financial services including banking, asset management, markets, payments and crypto-asset activities, and on emerging regulatory developments, including DLT, tokenisation and digital assets.

As DLT and tokenisation continue to develop and gain traction, they are expected to play an increasingly important role across all sectors of the financial system, with implications for business models, infrastructure, governance and regulatory compliance. If you would like to discuss the Discussion Paper, the webinar themes or potential impacts for your business, please get in touch.