Tokenized securities may live on distributed ledgers, but when the time comes to turn them into spendable central-bank money, most still travel over long-standing financial infrastructure. That is the picture painted in an October 28 report by the World Economic Forum and Boston Consulting Group, covering 35 jurisdictions, which argued that custody, settlement money, monetary sovereignty and collateral matter as much as how a token is legally classified.

One bond, three systems

Consider a single task tracked across three markets. An eligible local bank buys tokenized public-sector debt in its home currency, settles the purchase, holds the asset, and then seeks overnight funding from its central bank against it — raising cash without selling the bond. That last step is where the two worlds meet: central-bank money is a direct claim on the central bank itself, and the routes to it run through settlement accounts and collateral frameworks that long predate tokenization.

Eligibility matters from the outset. Holding the token gives an investment fund, an exchange or an ordinary wallet holder none of the access to central-bank facilities that a bank enjoys. The three markets are also at different stages: the euro area has a working collateral route, the United Kingdom's digital gilt remains a plan, and Singapore has published trial terms.

Euro area: accepted, if it arrives through the old door

Since March 30, 2026, the Eurosystem has accepted qualifying marketable assets issued through central securities depositories that use distributed ledger technology, under its existing collateral rules. A central bank's collateral framework sets out which assets banks may pledge when borrowing from it — the difference between a security being merely tradeable and being usable funding on a bank's balance sheet. Delivery comes with a condition. According to an ECB explanation, the assets must first be converted into a form compatible with settlement systems running on TARGET2-Securities before they can be pledged. Sending the token to another blockchain address is not enough.

Settlement in central-bank money is advancing more quickly. ECB board member Piero Cipollone said in an October 29 speech that tokenized wholesale trades have settled through Pontes, the ECB's bridge to blockchain platforms, since September 21. He described round-the-clock availability as a goal for 2028. Collateral eligibility is a separate question: the ECB is still assessing assets held outside currently eligible settlement systems.

UK: permission, one stablecoin at a time

The UK's Digital Securities Sandbox illustrates who decides which money can settle a trade. Sandboxes are supervised testing environments in which firms trial new infrastructure under defined conditions before any wider rollout. Under the Bank of England's updated sandbox guidance, a firm that wants to settle in a stablecoin must apply for that specific coin, through a Bank direction and an amendment to its sandbox approval notice. The guidance also depends on any Treasury amendments to the sandbox regulations. A stablecoin's regulatory status, on its own, earns it no place in a settlement system.

The government's own tokenized debt faces a funding test. HM Treasury has targeted the first quarter of 2027 for its Digital Gilt Instrument, DIGIT, and the Bank says on its wholesale-markets page that it is considering whether DIGIT will be eligible as collateral in the Sterling Monetary Framework, the arrangement through which the Bank provides central-bank money to participating firms against eligible collateral. That is an open review, not a decision. A separate Bank consultation covers what clearinghouses may accept — a different question altogether.

Singapore: digital bills, banking hours

The Monetary Authority of Singapore's trial auction details include a tokenized MAS Bill with S$10 million offered, issued on October 9 and maturing on October 23 — a 14-day instrument. The amount offered is not the same as the amount allocated.

The redemption terms show where the digital asset meets the old calendar. A request to redeem into central-bank digital currency made while the electronic payment system is closed is carried out on the next operating business day, with no extra payment for the wait. The token can move at any hour; the cash cannot.

Funding remains the open question. MAS's Standing Facility accepts MAS Bills as collateral, settled through its MEPS+ payment system, Singapore's real-time gross settlement system. The published documents do not say whether a tokenized bill on the trial network qualifies through that same route.

The common thread: the last mile is old infrastructure

No market is live at every step, and none offers cash at any hour. Wherever a tokenized bond does reach central-bank money, it passes through an existing system along the way: TARGET2-Securities in Europe, the Sterling Monetary Framework in the UK, MEPS+ in Singapore. The token is new; the exit to central-bank money is not. The choice of settlement asset is not a technicality: central-bank money carries no commercial-bank credit risk, which is why wholesale markets settle in it in the first place.

Ownership sits underneath all of it. MAS's tokenization guide asks issuers to state which record is definitive where onchain and offchain records coexist, and explains that control can rest on shared cryptographic keys. A lender taking a bond as security needs to know three things the blockchain alone cannot answer: whether the claim is enforceable, who can authorize a transfer, and what happens if the custodian fails.

Those conditions make tokenized assets safer to lend against. They also mean an asset can work smoothly inside one arrangement and stall at the edge of another — a gap that regional efforts such as Asia's digital-money push are trying to address.

What to look for in the next announcement

A tokenization launch says something useful when it names five things: who holds the enforceable ownership claim, which settlement money has been approved, which institution will accept the asset as collateral, how the asset is delivered into that institution's system, and when it can be redeemed for cash. Announcements that skip those details describe a new ledger, not a new route to money.

This article is provided for informational purposes only and does not constitute financial or investment advice.