ContextOpening speech by Christine Lagarde at the ECB conference "Money in transition" on digitalisation and innovation in payments.
Why it mattersThe ECB President presents the Appia tokenisation project and calls for an EU framework for digital assets.
- The euro's international role is held back by fragmented markets.
- European payment infrastructure is too divided.
- National rules on digital assets are multiplying.
- Build shared tokenisation standards through the Appia project.
- Get the market to invest in technology and common standards.
- Give legal certainty with a common EU framework for digital assets.
Read the speech summary
1. Two challenges at once
Opening with the medieval Champagne fairs, where merchants cleared debts on paper rather than shipping silver, Christine Lagarde said Europe's first common market faded when tolls rose and sea routes opened. Today two challenges arrive together: technology, above all tokenisation, is rewriting how money and trades settle, and geopolitics has made owning financial infrastructure a matter of power, so sovereignty counts. For Europe she sees an opportunity to cut fragmentation in capital markets and open retail payments to pan-European operators.
2. Wholesale markets and retail payments
In wholesale markets, 32 central securities depositories keep records across the Union against two in the United States, and tokenisation on a shared ledger would record ownership once and settle payment simultaneously. But it needs a risk-free settlement asset: more than 60 market participants said they will not issue digital assets at scale without settlement in the central bank's own money, so the Pontes project will settle tokenised transactions this year, and Appia is drafting a blueprint for a single European tokenised market. In retail, the digital euro would keep public money available as cash fades, and because it would be legal tender accepted everywhere with open standards, it could break the vicious circle that has stopped European card schemes reaching scale: international schemes handle over 60% of card payments and 13 of 21 euro countries lack a national scheme.
3. Cross-border payments and the euro's role
Cross-border payments remain slow and costly, a gap dollar stablecoins want to fill; the Eurosystem is linking its instant payment system TIPS with others, including India's UPI. Deep integrated markets anchored in public money would make the euro more attractive to global users, but this needs market investment and shared standards, and governments must provide a common legal framework for digital assets so that national rules do not rebuild the fragmentation technology is dissolving.