US Major Banks Launch Tokenized Deposit Network to Compete with Stablecoins
JPMorgan Chase, Bank of America, Citigroup and other major US banks announced plans to launch a shared tokenized deposit network through The Clearing House by the first half of 2027. The network will enable bank deposits to move across blockchain infrastructure with 24/7 settlement, offering capabilities similar to stablecoins while keeping funds within the regulated banking system. The move is seen as a direct response to the growing popularity of stablecoins like USDC and USDT, which could otherwise draw deposits away from traditional banks. Analysts note that tokenized deposits address inefficiencies in global payments, allowing near-instant transfers and reduced costs. While stablecoins dominate the onchain cash market, banks aim to retain control over customer deposits and operate within existing compliance frameworks. The initiative highlights increasing competition between stablecoins, tokenized deposits, and tokenized money market funds for the preferred form of blockchain-based cash. Despite differing from crypto's vision of open networks, the project signals mainstream adoption of blockchain technology by traditional finance institutions.
Key facts
- JPMorgan, Bank of America, Citigroup lead shared tokenized deposit network via The Clearing House.
- Network aims for 24/7 settlement, competing with stablecoins for onchain cash dominance.
- Tokenized deposits keep funds in regulated banking system, unlike stablecoins.
- Project targets launch by first half of 2027, signaling mainstream blockchain adoption.
- Banks respond to potential deposit drain from stablecoins like USDC and USDT.