Central Bank of Ireland publishes Feedback Statement to Discussion Paper 12

Background

On 2 November 2026, the Central Bank of Ireland (CBI) published its Feedback Statement (Feedback Statement) to Discussion Paper 12 – Distributed Ledger Technology (DLT) and Tokenisation in Financial Services (DP12).

As readers will recall from our previous briefing, the CBI invited views to be submitted by 5 June 2026 from across the financial system on the opportunities, enablers, challenges and risks associated with DLT and tokenisation in the financial system. These written responses were supplemented by the CBI’s wider engagement with market participants and other stakeholders.

Notable insights

In the Feedback Statement the CBI highlights that it aims to remain sufficiently informed, responsive and adaptable to support responsible application of emerging technologies as markets and international standards evolve. 

The Feedback Statement identifies key themes and priorities which are explored in more detail below. However, the CBI highlights a number of noteworthy points early on in the Feedback Statement which we have outlined below .

Shaping the CBI’s analysis

Three considerations informed the CBI’s analysis of feedback received:

• The wider technological landscape;

• The frictions tokenisation may usefully address; and

• The public-private partnership and appropriate role of public authorities.

Commonalities and different priorities of respondents

The CBI outlines in the Feedback Statement that tokenisation is progressing from conceptual and experimental phases towards further practical implementation. In addition, the CBI observes that there has been notable convergence on several underlying issues with respondents across sectors consistently emphasising operational resilience, legal and regulatory certainty and the importance of cross-border consistency.  However individual sectors also emphasised different priorities. In the case of investment funds for example, respondents highlighted as priorities: fund registers, distribution, transfer-agency functions, depositary oversight, valuation NAV process, liquidity and collateral, while securities and market infrastructure firms were focused on settlement finality, Central Securities Depositories (CSD) requirements, the DLT Pilot Regime, and the availability of on chain settlement assets.

Adding value

The CBI is of the view that the focus needs to shift to examining whether tokenisation along the value chain produces demonstrably better outcomes for market participants and users of financial services than the alternatives, when costs, risks, dependencies and system-wide effects are taken into account.

Adapting existing regulatory frameworks

The CBI states that there are robust regulatory frameworks in place and it is prudent to adapt existing regulatory frameworks where required, rather than implementing entirely new frameworks.

Its approach is grounded in technological neutrality: where financial activities give rise to comparable risks, the same regulatory outcomes should be achieved, irrespective of the technology through which those activities are undertaken.

Equally, regulatory uncertainty should not act as a barrier to the adoption of new technologies by the financial system. The CBI acknowledges that this requires regulatory frameworks that are sufficiently adaptable to accommodate innovation, while preserving the safeguards and protections, on which confidence and trust in money and the financial system depends. However, the CBI cautions that premature regulatory prescription could risk embedding assumptions about the technology’s deployment in the financial system, while the architecture is still evolving. As a result, the CBI’s future work may involve the consideration of the evidence of barriers to adoption, but the underlying public policy objectives of existing requirements and whether any proposed intervention would deliver a demonstrable benefit without compromising established regulatory safeguards.

These points are worth bearing in mind as they give an insight into the CBI’s approach in this area, including the positive steps that the CBI is taking in supporting innovation.

Key Themes

The Feedback Statement sets out the evolution of the CBI’s thinking on DLT and tokenisation following engagement on DP12 and identifies seven key themes which have emerged based on this engagement.

Key Theme 1: Establishing Legal Certainty

The CBI highlights that technological capabilities do not necessarily address legal considerations or establish legal ownership. Legal certainty, which may require legislative intervention, is needed on asset ownership, settlement finality, contractual enforceability and cross-border recognition. The CBI also acknowledges the Government’s commitment to update Irish primary legislation to enable the digitally native tokenisation of assets and an authoritative on-chain ownership register, as set out in the Ireland for  Finance Strategy – Vision 2030 .

Key Theme 2: Adapting Regulatory Frameworks

The CBI acknowledges the broad support for a technology-neutral, substance-over-form approach, rather than the creation of a separate regulatory framework for tokenised finance. Retaining existing requirements on investor protection, governance and liquidity management is important, however policy clarifications and/or targeted legislation may be required where there is legal uncertainty around new technological arrangements and how they will be implemented in practice. Responses to DP12 also identified on-chain data availability as an opportunity for supervisory approaches to evolve, by providing supervisors with more timely and detailed information. However, this doesn’t reduce firms’ responsibility for managing their own related risks.

Key Theme 3: Maintaining Governance and Accountability

Decentralised tokenisation infrastructure should not weaken governance standards in the financial system or shift responsibility away from regulated firms. The CBI emphasises that regulated-entity accountability should remain the starting point for effective supervision and regulation, with a focus on building technological capability and maintaining effective board challenge for outsourced activities. Three related layers of governance are highlighted by the CBI:

• A firm’s regulatory accountability

• Governance of the underlying infrastructure

• Operational arrangements when something goes wrong

Key Theme 4: Building Interoperability and Infrastructure

Interoperability is considered a key condition for tokenisation to achieve meaningful scale. The CBI emphasises the importance of common approaches to areas such as data, identity and asset servicing, in order to avoid deepening existing market fragmentation through the creation of separate pools of assets and liquidity.

The evolution of financial market infrastructures towards faster, more automated models of operation needs to be accompanied by appropriate liquidity arrangements, operational resilience and interoperability. In particular, the CBI notes that the implications of increasingly 24/7 markets will require careful consideration as the infrastructure evolves.

The CBI also confirms that interoperability between permissioned and permissionless networks is a priority policy focus, noting the divergent viewpoints among respondents.

Key Theme 5: Tokenisation of Assets

The CBI acknowledges the continued growth in financial asset tokenisation in recent years. It also recognises that maintaining a traditional register alongside on-chain records can limit DLT’s efficiency gains from shared ownership records and reduced duplication. However, the CBI emphasises that any evolution towards DLT-based authoritative records must preserve the critical functions of establishing ownership, supporting third-party enforceability and providing certainty in insolvency events. In addition, while respondents highlighted the near-instantaneous settlement and 24/7 transferability features of tokenisation facilitating collateral mobility and intraday liquidity management, there appears to be questions regarding the realisation of these benefits where (i) prefunding is needed; (ii) there is the loss of multilateral netting; and (iii) there is currently limited secondary market liquidity in tokenised assets.

Key Theme 6: Tokenisation of Money and Settlement

The limited availability of regulated euro-denominated on-chain settlement assets is highlighted as the most prominent signal across the consultation from feedback from respondents. The CBI also emphasises the importance of preserving central bank money as the ultimate wholesale settlement asset.

Pontes is described as a near-term link between DLT-based markets and central bank money, and Appia as a longer-term approach to shaping the European ecosystem.

There is broad support among respondents for bringing commercial bank money into the tokenised ecosystem. E-money tokens (EMTs) and tokenised commercial bank deposits are viewed as potentially complementary forms of settlement assets, depending on the use case.

The CBI will support collective efforts to develop interoperable tokenised deposits in the European market.

Key Theme 7: Managing Risks

The CBI’s focus is on end-to-end risk management. It views tokenisation as potentially migrating, concentrating, connecting or accelerating existing risks, rather than creating entirely new categories of risk. The resilience of a tokenised financial system will therefore require an understanding of the dependencies created when individual risk components interact or are reallocated. To this end, the CBI also stresses the need to manage reliance on smart contracts and external data sources so that they do not become single points of vulnerability.

Priority Areas

The Feedback Statement outlines a work programme aimed at developing the conditions for responsible adoption of tokenisation at scale. The CBI’s stated approach will remain iterative and evidence-led, combining market engagement, policy development, regulatory clarification and infrastructure development.

The programme is organised around five priority areas.

Priority Area 1: Enabling Central Bank Money Settlement and Evolving the Collateral Framework

The CBI will participate actively in the Eurosystem’s Pontes and Appia initiatives to support safe, efficient and interoperable settlement of tokenised assets in central bank money. It confirms that Pontes is operational and that the CBI is ready to support relevant market participants seeking access.

Through Appia, it will contribute to a longer-term blueprint for Europe’s tokenised financial ecosystem, due by 2028.

In collaboration with the Eurosystem, the CBI will be progressing work around collateral eligibility of tokenised assets.[1]

Priority Area 2: Support Efforts Domestically and in Europe to Advance Legal and Regulatory Clarity

The CBI will work with domestic and European authorities to identify and prioritise issues requiring legislative change, including smart contracts, legal ownership and transfer, authoritative records and settlement finality.

It will continue to coordinate with the Department of Finance on the Government’s commitment to update primary legislation to enable digitally native tokenisation of funds and assets and an authoritative on-chain register. It will also identify areas where regulatory clarification or adaptation can be progressed without primary legislative change, working with European partners. The objective is greater clarity without weakening resilience, investor protection, safe settlement or accountability.

Priority Area 3: Evolving our Innovation Practices in line with the Changing Landscape

A new Tokenisation Access Point (TAP) is to be established by the CBI which will provide (a) a clearer route through the Innovation Hub for engagement on tokenisation, practical implementation issues and the application of existing rules and (b) an important source of intelligence and practical evidence for the CBI, on how technology and markets are developing. Importantly, engagement through TAP will not constitute regulatory approval, an alternative authorisation route or endorsement of a business model or technology. Firms should therefore distinguish engagement on emerging issues from the formal approvals required for their proposals.

The CBI is also introducing an Innovation Insights model involving focused, time-bound sprints with the sector. Initial topics are expected to include DLT operational resilience, smart contracts, and governance and accountability, including on open, permissionless chains. A series of Tokenisation Insights Reports will set out developing policy, supervisory and central banking perspectives on sectoral and system-wide issues.

Priority Area 4: Shape the Development of the Tokenised Ecosystem to Guard Against Fragmentation

The CBI will lead domestic private-sector engagement on Appia and participate in its European Contact Group. This work will examine how central bank money and collateral services could operate across different DLT networks, alongside the development of infrastructure with European governance and common standards.

It will also support domestic efforts to explore interoperable tokenised commercial bank money, industry-led common standards and further exploration of tokenised bond issuance settling through Pontes. Engagement through ESMA and international bodies will seek regulatory convergence and interoperability. The CBI will also explore investing in DLT-based assets through its own investment portfolio to gain practical experience, while monitoring the ECB’s preparatory work in this area.

Priority Area 5: Understanding Macro-Financial Implications

The final priority is a multi-year research and analytical programme on tokenisation’s implications for financial-system risks, market functioning and payments and settlement efficiency. The CBI will also contribute to Eurosystem and European Supervisory Authority research, helping its policy and supervisory approach keep pace with developments.

Conclusion

If you have any questions regarding the Feedback Statement, please do not hesitate to reach out to the authors or your usual contact in Dillon Eustace.

Footnotes:
[1] Since March 2026, the Eurosystem has accepted marketable assets issued in central securities depositories using DLT-based services as collateral. The Eurosystem launched a work plan to explore whether, and on what conditions, DLT-issued assets outside eligible securities settlement systems could become eligible.