America’s largest banks are building a new digital currency network to stop a massive deposit drain
Key takeaways
- JPMorgan Chase, Bank of America, Citigroup and other major lenders said Friday that they plan to launch a shared tokenized deposit network through The Clearing House by the first half of 2027.
- The move highlights the growing competition to become the preferred form of cash on blockchain networks.
- Stablecoins, specifically Circle’s (CRCL) USDC and Tether’s USDT, currently dominate that market.
JPMorgan Chase, Bank of America, Citigroup and other major lenders said Friday that they plan to launch a shared tokenized deposit network through The Clearing House by the first half of 2027. The project would allow bank deposits to move across blockchain infrastructure with round-the-clock settlement, giving traditional bank money some of the same capabilities that have helped stablecoins gain traction.
The move highlights the growing competition to become the preferred form of cash on blockchain networks.
"Following the GENIUS Act, a competition seems to be emerging between stablecoins, tokenized deposits and tokenized money market funds to become the preferred onchain cash instrument," said Reid Noch, vice president of U.S. equity market structure at TD Securities.