DLT Pilot Regime
A share or bond in the EU trades on one venue and settles at a central securities depository. The DLT Pilot Regime is the EU regulation that lets one licensed operator do both on a blockchain, for tokenized shares, bonds and fund units up to fixed size limits. In Germany, BaFin has granted such permissions to 21X and 360X in Frankfurt. Dated events on the topic are in the calendar below.
How a securities trade settles without the pilot
In the classic setup, a trading venue such as an exchange or a multilateral trading facility (MTF) matches buyer and seller. Settlement, the exchange of securities against cash, happens afterward at a central securities depository (CSD), which keeps the register of who owns what; in Germany that is Clearstream. Each step has its own license and its own EU law: MiFID II for the venue, the CSD Regulation for settlement. The answer on clearing and settlement describes the two steps.
Those laws assume book entries in a securities account, a participant list made of banks and brokers, and cash that moves through a payment system. A blockchain where investors hold tokens in wallets and the trade settles in one transaction fits none of these definitions. Regulation (EU) 2022/858, the DLT Pilot Regime, has applied since March 23, 2023 and creates an exception for this case.
Three types of DLT market infrastructure
The regulation defines three licenses. A DLT MTF is a trading venue for tokenized financial instruments, run by an investment firm or a market operator. A DLT settlement system (DLT SS) is run by a CSD and settles on a distributed ledger. A DLT trading and settlement system (DLT TSS) combines both in one entity, which the classic rules do not allow. ESMA also lets newcomers apply for a temporary investment firm or CSD authorization together with the DLT application.
In return for the exemptions, the pilot caps what may be admitted: shares of issuers with a market capitalization below 500 million euros, bonds with an issue size below 1 billion euros, and UCITS fund units with assets under management below 500 million euros. All DLT financial instruments on one infrastructure together may not exceed 6 billion euros, as a legal analysis on JD Supra sets out. The national supervisor grants the permission, it is valid across the EU, and each permission lists the exemptions granted, for example from the CSD Regulation's rules on book-entry form, settlement finality or cash settlement.
Who holds a permission in Germany
ESMA's list of authorized DLT market infrastructures names two German operators. BaFin granted 21X a permission for a DLT trading and settlement system on December 3, 2024, with exemptions from the CSD Regulation that include settlement finality, cash settlement and participation rules. 360X received a permission for a DLT MTF on April 29, 2025. The same list names a DLT settlement system of the Czech central securities depository, a DLT TSS in Lithuania and one in France.
21X settles trades between tokenized securities and e-money tokens on chain, so the cash leg runs in a regulated euro stablecoin. The e-money tokens page explains that legal category, and the wholesale CBDC page covers the Eurosystem's plans for settlement in central bank money. Which German law makes a security exist only as a register entry is a separate question, answered by the Electronic Securities Act: it defines the instrument, while the pilot regime licenses the venue and the settlement.
From pilot to permanent rules
The regulation started as an experiment with a review clause. In June 2025 ESMA suggested making the regime permanent and setting thresholds and eligible assets according to the risk of each business model, after what it called an initially limited uptake. The European Commission's market integration and supervision package of December 4, 2025 takes up the pilot regime as part of the savings and investments union. The capital markets union page covers the rest of that package.
For a bank or asset manager in Germany, the practical questions are where a tokenized bond can be listed, which custodian holds the token for clients, and which form of money settles the trade. The panel on DLT-based market infrastructures at the Frankfurt Forum on Digital Assets & Applications, with DekaBank, 360X, 21X and Seturion, dealt with these choices.
Upcoming events on tokenized securities in Germany
Finance Loop and the DLT Pilot Regime
Finance Loop and 21X, the holder of the German DLT TSS permission, announced a strategic cooperation on on-chain finance, with joint events and knowledge sharing. The pilot regime is also a regular subject at the Crypto Assets Conference of Frankfurt School and Deutsche Börse, a conference Finance Loop has partnered with.
Investment & Digital Assets
Payments & Digital Money
What is the DLT Pilot Regime?
It is EU Regulation 2022/858, which has applied since March 23, 2023. It lets licensed operators trade and settle tokenized shares, bonds and fund units on a distributed ledger, with exemptions from MiFID II and the CSD Regulation, within fixed size limits.
Which DLT market infrastructures are authorized in Germany?
21X in Frankfurt holds a BaFin permission for a DLT trading and settlement system, and 360X holds one for a DLT MTF. ESMA keeps the full EU list with the exemptions each operator received.
Which instruments can be traded under the pilot?
Shares of companies with a market capitalization below 500 million euros, bonds with an issue size below 1 billion euros and UCITS units with less than 500 million euros under management. Crypto-assets such as bitcoin fall under MiCA instead.
Will the DLT Pilot Regime become permanent?
ESMA recommended it in June 2025, and the Commission's market integration package of December 4, 2025 includes changes to the regime. The outcome depends on the legislative process in the European Parliament and the Council.
DLT Pilot Regime and Finance Loop
Finance Loop covers the DLT Pilot Regime in its Investment & Digital Assets track, next to tokenized bonds, funds and the German Electronic Securities Act. Finance Loop has a strategic cooperation with 21X and brings people from banks, asset managers, exchanges and their lawyers together at events in Frankfurt, Munich, Berlin and Hamburg.
Finance Loop is a professional network and has the goal of driving the adoption of emerging technologies in finance, such as AI, digital payments, cloud and blockchain solutions. Finance Loop helps its members build skills and personal networks in these fields: Investment & Digital Assets, Payments & Digital Money, Digital Infrastructure & Sovereignty, and Risk & Compliance.