BNY Mellon May Explore Tokenized Deposits As Stablecoin Alternative for Faster Cross-Border Payments

Tokenized deposits are digital bank-issued coins backed one-to-one by commercial bank balances; BNY Mellon is piloting them to move part of its $2.5 trillion daily payment flow onto blockchain rails to enable instant, 24/7 transfers and speed cross-border ￰0￱ 24/7 transfers BNY aims to route a portion of its $2.5 trillion daily flows onto blockchain ￰1￱ pilots from Goldman Sachs, JPMorgan and HSBC show growing institutional ￰2￱ deposits news: BNY Mellon pilots tokenized deposits to speed cross-border payments—read the update and what banks must ￰3￱ are tokenized deposits? Tokenized deposits are digital representations of bank deposits issued on a distributed ledger, redeemable one-to-one for commercial bank ￰4￱ act as direct claims on a bank’s on‑balance‑sheet funds and enable real‑time settlement, reducing reliance on legacy batch-clearing ￰5￱ will BNY Mellon use tokenized deposits?

BNY Mellon is exploring tokenized deposits to move a portion of its $2.5 trillion daily payment flow onto blockchain rails, aiming for instant, around‑the‑clock transfers and streamlined cross‑border ￰6￱ Slabicki, executive platform owner for Treasury Services at BNY Mellon, described the effort as part of upgrading real‑time and international payments (statement reported by Bloomberg). BNY Mellon is exploring tokenized deposits to move part of its $2.5 trillion daily payment flow onto blockchain rails and modernize cross-border settlements. BNY, the largest custodian bank in the world, is exploring tokenized deposits to enable clients to transfer funds instantly, 24/7, while easing constraints of its legacy ￰7￱ Slabicki, executive platform owner for Treasury Services at BNY, told Bloomberg that the project is part of an effort to upgrade real-time and cross-border payments, aiming to move a portion of its $2.5 trillion daily payment flow onto blockchain ￰8￱ deposits can help “banks overcome legacy technology constraints, making it easier to move deposits and payments across their own ecosystems – and eventually, across the broader market as standards mature,” Slabicki ￰9￱ deposits are digital coins backed one-to-one by commercial bank ￰10￱ stablecoins, which are often backed by securities or third-party reserves, tokenized deposits represent direct claims on commercial bank ￰11￱ reached out to BNY for comment, but had not received a response by ￰12￱ are global banks adopting tokenized deposits?

Major banks are piloting tokenized deposits to achieve real‑time settlement, reduce counterparty and operational risk, and offer 24/7 liquidity for institutional ￰13￱ from Goldman Sachs and BNY to tokenise money market funds, and pilots by JPMorgan and HSBC, demonstrate a cross‑industry shift toward tokenized cash ￰14￱ institutions are piloting tokenized cash? Goldman Sachs + BNY Mellon: tokenized money market funds for institutional investors. JPMorgan: launched a tokenized deposit pilot (JPMD). HSBC: rolled out cross‑border tokenized deposit services for corporate ￰15￱ Shinsei Bank + Partior + DeCurret DCP: exploring multicurrency tokenized deposits for real‑time ￰16￱ deposits vs stablecoins vs traditional transfers Characteristic Tokenized deposits Stablecoins Traditional transfers Backing Commercial bank balances (one‑to‑one) Securities, reserves, or algorithmic Bank ledger entries Settlement speed Real‑time (24/7) Near‑real‑time or dependent on rails Batch or same‑day/next‑day Counterparty claim Direct claim on issuing bank Claims on issuer reserves Claims on bank accounts How can banks implement tokenized deposits?

Banks should adopt clear standards, regulatory engagement, and multi‑party ￰17￱ with industry consortia and payment‑rail providers is critical to ensure interoperability and risk controls. How-to: 5 steps for a tokenized deposit pilot Define governance, compliance and KYC/AML ￰18￱ ledger technology and interoperability ￰19￱ a small, controlled pool of commercial bank ￰20￱ parallel tests against legacy systems to validate ￰21￱ with industry participants and shared settlement ￰22￱ Asked Questions Are tokenized deposits the same as stablecoins? ￰23￱ deposits are direct digital claims on a commercial bank’s on‑balance‑sheet funds and are issued by banks; stablecoins are typically issued by non‑bank entities and backed by reserves or ￰24￱ tokenized deposits replace correspondent banking?

Not ￰25￱ deposits can reduce reliance on correspondent banking for many flows, but broad adoption requires standardization, regulatory clarity and integration with existing settlement ￰26￱ client money safer with tokenized deposits? Tokenized deposits preserve the underlying bank claim, but safety depends on issuer solvency, legal frameworks and custody ￰27￱ governance and regulatory oversight remain ￰28￱ Takeaways Real‑time liquidity : Tokenized deposits enable 24/7 settlement for institutional ￰29￱ momentum : Major banks including Goldman Sachs, JPMorgan and HSBC are piloting tokenized cash ￰30￱ steps : Pilots should focus on governance, interoperability, and parallel testing with legacy ￰31￱ BNY Mellon’s tokenized deposits pilot marks an important step toward modernizing high‑value payment flows and cross‑border ￰32￱ banks, regulators and market infrastructures align on standards, tokenized deposits could materially speed international liquidity and reduce operational ￰33￱ iterative pilots and expanding consortium efforts in the months ahead. , "description": "BNY Mellon is piloting tokenized deposits to move part of its $2.5 trillion daily payment flow onto blockchain rails for instant, 24/7 transfers and faster cross-border settlement.", , Money market fund tokens.