Banks' interest in tokenized deposits grew in second quarter
RWA Signal Insight
StablecoinsLarge financial institutions are increasingly prioritizing tokenized deposits over stablecoins as a preferred method for modernizing cross-border payments and internal business operations. American Banker research indicates that 24 of the top 50 U.S. banks now monitor tokenized deposits, compared to 17 tracking stablecoins. Citi CEO Jane Fraser highlighted that tokenized deposits offer new revenue streams and client acquisition opportunities, with the bank actively exploring both deposit tokens and stablecoin reserve management. Wells Fargo is set to launch a tokenized deposit program this fall for corporate clients, supporting U.S. dollars and British pounds. Furthermore, a consortium including JPMorganChase, HSBC, and BNY is collaborating with The Clearing House to develop a unified tokenized deposit network. While stablecoins remain a focus for some, with the upcoming Open Standard venture launching Open USD, banks currently show higher activity levels in piloting tokenized deposits. This shift reflects a broader institutional preference for regulated, bank-issued digital assets that leverage existing deposit insurance frameworks. The trend signals a significant evolution in how traditional banks intend to bridge legacy payment rails with distributed ledger technology.
Key points
- 24 of the top 50 U.S. banks now track tokenized deposits, up from 19.
- Four major U.S. banks have active tokenized deposits, versus only one with stablecoins.
- Wells Fargo will launch a cross-border tokenized deposit service for USD and GBP.
- A consortium including JPMorgan, HSBC, and BNY is building a tokenized deposit network.
Background
Tokenized deposits are digital representations of a claim against a licensed depository institution, issued on a distributed ledger. Unlike stablecoins, which are typically backed by external reserves, these assets are integrated directly into a bank's balance sheet and benefit from traditional deposit insurance. They are designed to facilitate 24/7 programmable settlement and cross-border transfers within the regulated banking ecosystem.