Banks are increasingly exploring tokenized deposits as they seek to integrate commercial bank money into blockchain-based payment and settlement systems. According to Cointelegraph, a recent report from real-world asset data platform RWA.io highlights this trend, with contributions from industry players such as UK Finance, Citi, BNY, JPMorgan’s Kinexys, Standard Chartered, ABN Amro, and Digital Asset. The report suggests that tokenized deposits are emerging alongside stablecoins and central bank digital currencies (CBDCs) as part of a broader onchain cash stack.
Tokenized deposits represent digital versions of traditional bank deposits on blockchain or other distributed ledger technologies. Unlike many stablecoins, these deposits are direct liabilities of the issuing bank and adhere to existing banking regulations, including deposit insurance, capital requirements, and Anti-Money Laundering and Know Your Customer rules. The report notes a growing number of bank pilots and deployments in Europe. For instance, in January, Lloyds Banking Group and Archax completed the UK’s first public blockchain transaction using tokenized deposits on the Canton Network. Additionally, UK Finance’s Great British Tokenised Deposit pilot is testing various applications, including person-to-person marketplace payments, remortgaging, and digital-asset settlement, with plans extending through mid-2026.
This movement reflects banks' efforts to maintain their roles in payments, treasury, and deposit-taking as digital cash instruments proliferate. UK Finance emphasized in the report that tokenized deposits will be crucial in a future "multi-money" world, complementing other forms of digital money, both privately and potentially publicly issued. Marko Vidrih, co-founder and chief operating officer at RWA.io, noted that while much attention in digital money focuses on stablecoins or CBDCs, the global financial system still relies on commercial bank money. Vidrih stated, "Bringing that money onto digital rails will underpin the next generation of digital finance."
Meanwhile, the European Central Bank (ECB) is advancing its work on a digital euro, as US dollar-backed stablecoins continue to dominate digital asset markets and cross-border transactions. The ECB has opened applications for experts to contribute to workstreams on how a digital euro would function across ATMs, payment terminals, and acceptance infrastructure. The ECB plans to begin a 12-month pilot for the digital euro in the second half of 2027. In March, the ECB unveiled Appia, its long-term plan for tokenized financial markets in Europe, which includes Pontes, a new settlement mechanism designed to connect blockchain-based financial platforms to the Eurosystem’s existing payment infrastructure. Pontes is scheduled to launch in the third quarter of 2026, with feedback from Appia’s consultation process shaping the wider framework for Europe’s tokenized financial system.
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