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Innovation Tour: Moving Regulated Digital Assets and Currencies from Conception to Reality

Innovation Tour: Moving Regulated Digital Assets and Currencies from Conception to Reality

A tour organized by IBM and the LF Decentralized Trust Foundation as part of Point Zero Forum 2025

Overview

We are excited to share the highlights of the Innovation Tour on Moving Regulated Digital Assets and Currencies from Conception to Reality, organized by IBM and the LF Decentralized Trust Foundation.

As the financial world embraces tokenization—from central bank digital currencies (CBDCs) to tokenized deposits, bonds, securities, and stablecoins—we are witnessing a transformation in how financial assets are managed. Tokenization not only introduces greater transparency and efficiency but also opens the door to a more inclusive, secure, and innovation-driven economy. However, this shift also brings forward significant legal, business, and technical challenges, which demand enhancements to current technologies and infrastructures.

With a longstanding commitment to permissioned Distributed Ledger Technologies (DLTs) and a leading role in LF Decentralized Trust, IBM is uniquely positioned to address these challenges. Leveraging IBM’s deep expertise in cryptography, confidential computing, and secure systems, our teams will demonstrate how LF Decentralized Trust projects—and IBM’s own contributions and extensions—can support the creation of differentiated, secure, and scalable infrastructures for the financial systems of today and tomorrow.

A highlight of the tour was the live demonstration from Banque de France of their DL3S platform, a cutting-edge wholesale CBDC system built using early versions of these foundational technologies, open sourced under LF Decentralized Trust.

Throughout the tour, you have seen IBM’s full technology stack for regulated digital assets and currencies in action, alongside innovations from IBM Research and IBM Consulting. These demonstrations are designed to showcase both immediate solutions and the groundwork for a trusted, scalable financial future.

The stack comprises:

  1. Application Libraries
  • Privacy-respectful and compliant token exchange — Powered by the LF Decentralized Trust Lab Token SDK, enabling flexible and compliant asset transfers.
  • Identity management aligned with self-sovereign principles — Supporting a user-centric model of asset ownership that improves portability, recovery, and accountability while preserving privacy.
  • System interoperability — Facilitating smooth integration with legacy infrastructures or DLT-based systems, using components partially derived from Hyperledger Cacti.
  1. Shared Ledger Infrastructure: A high-performance Distributed or Centralized Ledger Technology, capable of processing over 100,000 transactions per second, designed for the demands of regulated environments, based on Hyperledger Fabric enhancements.
  2. Secure Custody: IBM HyperProtect Crypto Services — Delivering hardware-grade security for key management and digital asset custody.

Novel enhancements of these technologies were demonstrated by IBM four wholesale and retail tokenization (interoperability) scenarios, particularly in their ability to address current industry challenges, with reference to combining:

  • privacy with transparency and compliance
  • transparency with resilience and a high degrees of scalability
  • interoperation with legacy or modern systems, as well as with complementary traditional banking operations
  • programmability and composability of assets, enabling the building of a system with technology agnosticism
  • quantum readiness and resilience

The IBM Research team will further illustrate live technologies and cryptographic components that enable privacy-preserving liquidity pools, that can extend to arbitrary on-chain computation with quantum-resilience.

Banque de France joined IBM in live demonstrations of the DL3S platform. DL3S is a leading wholesale CBDC platform participating in the ongoing eurozone’s wholesale pilot regime, which is based on the same Hyperledger projects IBM Research has been innovating in over the last eight years!

Please do not hesitate to reach out to us if you have any questions or interest to learn more about what we do by filling out this form. We look forward to interesting and productive follow-up discussions!

What You Saw in the Innovation Tour

IBM Research technologies feed the IBM technology stack for digital assets, a prior version of which sits in a variety of LF Decentralized Trust projects. That technology stack was demonstrated live across four types of use cases:

  1. Wholesale Central Bank Digital Currencies (CBDCs) and Tokenized Securities Settlement, where the DL3S Platform was demonstrated by Banque de France. Atomic interoperation with other forms of assets (e.g., tokenized securities) or networks, privacy and audit compliance are the main focus and characteristics of this demo.

  2. Retail Regulated Currencies at scale (can be CBDCs, tokenized deposits or stablecoins), demonstrating funding, and online and offline payment operations, including top-up of the end user’s offline wallet. The focus of this demo was the privacy, compliance, and scalability of the platform, as well as its ability to leverage the self-sovereign identity paradigm and standards.

  3. A regulated liability network for domestic interbank payments, bringing together tokenized deposits of various commercial banks and CBDCs. The demo assumes different architectural designs for each tokenized deposit instance and CBDCs and showed how cross-system payment can take place atomically. This demo highlighted the ability of a single platform to host a variety of assets governed by the same or different stakeholders, with the same or different rules, and its ability to combine these assets in atomic exchanges in a technology-agnostic manner.

  4. A privacy-preserving version of the Uniswap liquidity pool using advanced cryptography. Uniswap allows users to exchange tokens of different types in a decentralized way. It is one of the most popular blockchain applications used today, with daily trade of more than 1B$. The demo shows how we can utilize advanced quantum-safe cryptography—namely, Fully-Homomorphic Encryption—to hide the users’ inputs while maintaining their privacy. This application can be integrated on top of FHE-enabled Ethereum layer 2 solutions and other supporting DLTs.

Finally, the IBM Research foundational cryptography team, and quantum-safe NIST standard leading contributors, illustrated quantum-safe cryptography relevant for regulated digital assets and currencies, with advancements in the state of the art in terms of both, scale and privacy.

Who We Are

This tour was co-hosted by IBM and the LF Decentralized Trust Foundation. IBM is represented by the IBM Research, IBM Consulting, and IBM Technology organisations.

IBM Research is the organic growth engine of IBM, tuned to deliver on what’s next in computing and enable IBM’s long-term business success. This Innovation Tour featured work from the Decentralized Trust and Foundational Cryptography teams at IBM Security Research—experts in distributed systems, cryptography, and security, with a legacy of contributions including the architecture of Hyperledger Fabric, NIST standards, and practical implementations of advanced cryptographic frameworks. The teams continue to lead innovation in privacy-preserving, regulated asset transfer, often in close collaboration with IBM’s client-facing teams on first-of-a-kind digital asset projects that push the boundaries of today’s technology.

Your Contacts:

IBM Consulting has dual expertise in industry and technology. It is a global and local player recognized as a leader on enterprise blockchain and business platforms. IBM Consulting experts advise many financial institutions on regulatory aspects of digital assets and CBDC. Our Promontory organization fully understands the financial regulatory requirements that need to be implemented in most or all CBDC or digital asset solutions and is advising central banks and regulators in Europe. More importantly, IBM understands what it takes to put regulatory compliant blockchain networks into production, as we operate some of the largest financial systems and have unique experience in building production business platforms. Our team has experience delivering smooth implementations of complex CBDC projects and can provide comprehensive training and offer ongoing support to our clients.

Your Contacts:

IBM Payments Center is a global network of payments ecosystems to help enable rapid, multi-industry transformation through a secured, stable and scalable framework on an open and collaborative marketplace.

Our global payments ecosystem offers consulting, architecture, and engineering services, using standardized payments infrastructure, through a marketplace approach with point solutions and as-a-service capabilities.

The IBM Payments Center expertise leverages a variety of environments, including multiple cloud models, and we bring together the best of IBM Consulting and Technology to help reduce infrastructure costs, enhance operational efficiency, and improve customer experience for financial institutions and businesses.

Your Contacts:

IBM Technology is the technology provider for industry-leading security concepts. Digital assets, tokens, keys or sensitive data are best protected by the combination of IBM hardware such as IBM® LinuxONE or IBM® Z servers, in combination with the IBM® Hardware Security Module running the IBM® Hyper Protect software. These components form the IBM Confidential Computing capabilities to protect data while being “in use”, “in transit”, or “at rest”. IBM® Z and IBM® LinuxONE are running Linux and are the bedrock for quantum-safe encryption and quantum-safe signatures. IBM provides these security-focused products as on-premise and/or IBM Cloud offerings.

IBM® Hyper Protect Digital Assets Infrastructure is a secure hosting environment that provides end-to-end security for digital asset actors (e.g., custodians, exchanges, issuance providers, banks) that must protect private keys, governance, applications and data. Combined with IBM® Hyper Protect Services, it provides the building blocks for end-to-end solutions leveraging enterprise-grade hardware-based services, paired with a security model certified at the highest levels in the industry to safeguard, store, trade, issue and manage digital assets.

Last but not least, the IBM® Offline Signing Orchestrator is designed to address limitations of current cold storage offerings for digital assets, including the need for people to perform manual procedures for the execution of a cold storage transaction, resulting in privileged administrator access, operational costs and errors and the inability to truly scale.

Your Contact:

LF Decentralized Trust was introduced in 2024 by Linux Foundation to encompass the growing portfolio of Hyperledger projects and host new open source software, communities, standards, and specifications that are critical to the macro shift toward decentralized systems of distributed trust. Prior to LF Decentralized Trust, LF Hyperledger was founded in 2015 to bring transparency and efficiency to the enterprise market by fostering a thriving ecosystem around open source blockchain software technologies. Hyperledger Foundation, therefore, coordinated a community of member and non-member organizations, individual contributors, and software developers building enterprise-grade platforms, libraries, tools, and solutions for multi-party systems using distributed ledger, and related technologies. Organizations joined Hyperledger Foundation to demonstrate technical leadership, collaborate and network with others, and raise awareness around their efforts in the enterprise blockchain community. Members include industry-leading organizations in finance, banking, healthcare, supply chains, manufacturing, technology and beyond. All LF Decentralized Trust code is built publicly and available under the Apache license.

Your Contacts: