The Boerse Stuttgart Group, Germany’s second-largest exchange, has announced the successful completion of a blockchain settlement test for secondary market transactions, in partnership with the European Central Bank (ECB). This achievement represents the group’s inaugural settlement of exchange transactions using blockchain-based securities against central bank funds. The innovative settlement solution was integrated with the Deutsche Bundesbank’s trigger mechanism, linking it to the conventional euro payment system.

This test was part of the ECB’s broader investigation into blockchain technology and involved collaboration with six partner banks: Commerzbank, Deutsche Bank, DZ Bank, LBBW, Bankhaus Metzler, and V-Bank. These institutions utilized Boerse Stuttgart’s blockchain settlement framework to execute various transactions involving five tokenized securities, such as bonds, funds, and stocks. A key outcome of the project was the demonstrated ability to reduce settlement time from two days to mere minutes, enhancing the interoperability between blockchain systems and central bank money. This process allows for the automation of settlements directly among trading participants, increasing efficiency, security, and mitigating counterparty risk.

The pilot initiative explored individual cases as well as various transaction scenarios to evaluate the practical implications of blockchain technology under real market conditions. By simulating normal operational environments alongside exceptional cases, the project provided valuable insights into the reliability of blockchain integration in digital markets. In addition to Boerse Stuttgart’s crypto custody service, EUWAX AG, a German brokerage, played a significant role in analyzing the findings and supporting the ECB’s assessment of blockchain uses in capital market transactions.

On September 19, DZ Bank joined forces with Boerse Stuttgart Digital Group to combine the group’s regulatory framework and technical infrastructure for the bank’s upcoming crypto services. This partnership is set to connect around 700 banks under DZ Bank’s network, enabling them to provide retail customers with access to digital assets by the end of 2024.