Guest lecture by Piero Cipollone, Member of the ECB Executive Board

As part of its Central Bank Speaker Series, the Frankfurt School Centre for Central Banking (CfCB) welcomed Piero Cipollone, Member of the Executive Board of the European Central Bank (ECB) for a guest lecture on 8 December. Introducing the speaker, Emanuel Mönch, Professor of Financial and Monetary Economics and Co-Director of the Centre, highlighted Cipollone’s extensive expertise in central banking and the scope for policy choices in the field of digital payments innovation to help select the good equilibria.

In his lecture “The transformation of money: technological disruption and the future of financial services”, Cipollone examined how rapid technological change is reshaping money, payments, and financial market infrastructures – and why central banks must take an active role in this transformation.

“If central banks don’t issue digital money, they will lose their central role in money issuance and fail to provide an anchor of stability to the entire financial system.”

Piero Cipollone, Member of the Executive Board of the ECB

Cipollone stressed that Europe faces three key challenges: fragmentation in retail payments, the emergence of new technologies such as tokenisation that risk undermining monetary stability, and the persistent complexity of cross-border payments. Without decisive action, Europe could become increasingly dependent on non-European payment solutions and settlement assets, with potential implications for financial stability, competitiveness, and strategic autonomy.

To address these issues, the Eurosystem is pursuing a strategy based on public-private collaboration and technological neutrality. A digital euro, he explained, would complement cash by offering a European means of payment accepted across the euro area, reduce reliance on international card schemes, and provide a common standard that supports private innovation. Safeguards such as holding limits ensure that the digital euro preserves the role of banks in financing the economy.

In wholesale markets, the ECB aims to provide tokenised central bank money to support the safe scaling of digital assets. Cipollone outlined two major initiatives: Project Pontes, a bridge enabling settlement of DLT-based transactions from 2026 onwards, and Project Appia, which will explore a future integrated digital asset ecosystem for Europe.

Looking beyond the euro area, the ECB is also working to enhance cross-border payments by interlinking fast payment systems. Initiatives involving TIPS and partners from Europe to Asia aim to make cross-border transactions faster, cheaper, and more transparent – reducing reliance on emerging private stablecoin solutions.

Cipollone closed with a clear message: Europe must choose whether to shape the next era of digital payments or accept systems built elsewhere. By acting now, he argued, Europe can foster innovation while safeguarding monetary sovereignty, supporting competitiveness, and delivering tangible benefits for citizens and businesses.

The lecture concluded with a lively discussion moderated by Michael Ehrmann, Banque centrale du Luxembourg Professor of Central Banking at Frankfurt School of Finance & Management. The event once again demonstrated the Centre for Central Banking’s role as a leading forum connecting academia, policymakers, and the financial sector.