Irish Funds Responds to the CBI's Discussion Paper 12 Distributed Ledger Technology (DLT) & Tokenisation in Financial Services

Digital assets and tokenisation continue to gain momentum across Europe, with regulators, policymakers and industry participants increasingly focused on practical implementation and the evolution of market infrastructure.

Irish Funds recently responded to the Central Bank of Ireland’s Discussion Paper 12 (DP12) on Distributed Ledger Technology (DLT) and tokenisation, contributing to the ongoing dialogue on how these technologies can be adopted safely, effectively and in a manner that supports investor confidence. Members of the Irish Funds Digital Assets Working Group also participated in a Central Bank of Ireland roundtable discussion in May, providing valuable industry insights on the opportunities and challenges associated with tokenisation.

Irish Funds also participated in the EFAMA Digital Assets Forum in Brussels, where policymakers, regulators and industry experts explored the next phase of digital asset adoption in Europe. Discussions focused on scaling tokenised products, addressing cross-border challenges and ensuring that innovation develops alongside strong standards for investor protection and financial stability. John Burrowes moderated a regulatory panel, which included representatives from the Central Bank of Ireland, with Rosemary Hanna among those contributing to the discussion.

Several key themes emerged from both the EFAMA forum and the response to DP12:

Same activity, same risk, same rules
Tokenisation does not alter the fundamental nature of financial assets. The underlying activities, risks and regulatory expectations remain the same, with technology providing new methods for representing, recording and transferring assets.

Digital cash as a critical enabler
The future of on-chain finance is likely to rely on a range of digital cash solutions, including central bank digital currencies (CBDCs), stablecoins and tokenised deposits. A combination of these instruments is expected to support different market needs while maintaining liquidity, settlement certainty and financial stability.

Interoperability and integration
A major challenge for the sector remains ensuring that tokenised assets can integrate effectively with existing financial infrastructure and that different DLT ecosystems can operate seamlessly across jurisdictions. The European Commission and the Central Bank of Ireland highlighted the importance of common industry standards to avoid fragmentation and enable scale.

The direction of travel is clear: tokenisation represents more than a technological advancement; it is a broader evolution of financial market infrastructure. Continued collaboration between industry, regulators and policymakers will be essential to unlocking its full potential while maintaining trust, resilience and stability across the financial system.

Please see our response on our Member Portal.