According to Cointelegraph, European Central Bank officials have proposed the concept of a “European ledger”, a unified ledger that will integrate European digital assets and currencies to improve efficiency and synergy.
Piero Cipollone, a member of the European Central Bank's executive board, said that Europe's traditional capital markets suffer from fragmentation and inconsistent legislation, but there is an opportunity to create a digital capital markets union.
Cipollone noted that more than 60% of EU banks are exploring or experimenting with distributed ledger technology (DLT), while another 22% are already using it. Although DLT offers opportunities for financial integration, it is not guaranteed to materialize.
DLT is currently used primarily for issuing assets, but extending it to negotiation, settlement, and custody could reduce costs and enable 24/7 operations. Both investors and central banks would benefit.
The concept of a unified ledger has received attention from the Bank for International Settlements and other institutions, but it may inhibit innovation. Traditional finance needs the flexibility provided by competing DLT platforms.
Despite these issues, the ECB is exploring ways to use central bank money to settle DLT transactions.