JPMorgan, Bank of America, Citi to start blockchain offensive with shared tokenized network
Key takeaways
- The system will be operated by The Clearing House, the payments company collectively owned by the banks.
- Tokenized deposits are blockchain representations of customers' money held at a bank.
- Stablecoins are dollar-pegged digital assets issued by crypto companies that live outside the traditional banking system.
The banks plan to convert traditional bank deposits into blockchain-based tokens that can move quickly around the clock, while keeping funds inside the regulated banking system.America's biggest banks, including JPMorgan, Citi and Bank of America, plan to build a shared, tokenized deposit network by the first half of 2027 to protect their deposits from the threat posed by stablecoins, the Wall Street Journal reported.
The system will be operated by The Clearing House, the payments company collectively owned by the banks. Some banks are calling the network "the bridge," others call it "the chain," the WSJ said.
Tokenized deposits are blockchain representations of customers' money held at a bank. The planned system will convert these deposits into a digital token that can be transferred swiftly on a blockchain.