The largest Wall Street banks plan to launch a tokenized deposit network in the first half of 2027.
The initiative is led by The Clearing House, a real-time payments company co-owned by major financial institutions including JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo.
Project to Bridge Traditional Payments with Blockchain
According to the Wall Street Journal, the project—referred to as “the bridge”—is designed to connect traditional banking payment systems with blockchain infrastructure so tokenized deposits can move instantly with 24/7 settlement. The underlying blockchain will be developed in partnership with a third-party vendor that has not yet been selected.
“This is a big move for the banks,” said Clearing House Chief Executive David Watson, noting that the industry is heading toward a “radically different” future for on-chain payments and finance.
Citi describes the initiative as a natural extension of the role banks already play in the financial system. Shahmir Khaliq, the firm’s head of services, said the move represents “another step that effectively cements” banks’ roles in financing, money management, and capital markets.
At the same time, banks have expressed wariness about stablecoins, concerned that their use could divert deposits away from traditional institutions. Financial and crypto firms have clashed for months over proposed legislation that would allow crypto customers to earn interest on stablecoin holdings.
Demand for Adoption Expected to Be Gradual
The Clearing House says the tokenized deposit network will be available to all U.S. banks. Potential use cases include real-time liquidity management, programmable treasury operations, and cross-border payments. The organization also expects large multinational corporations to be among the first adopters.
However, Bank of America’s head of global payment solutions, Mark Monaco, cautions that clients are not “beating down the door” for tokenized deposits just yet. He added there is growing interest, but that adoption will take time.
JPMorgan has already experimented with tokenized deposits through JPM Coin, an in-house token used to settle payments on its private blockchain, and more recently launched a token on Base for institutional clients.
This announcement follows prior discussions among major financial institutions about issuing a joint stablecoin through The Clearing House and Early Warning Services. While that option remains under consideration, some banking executives remain uncertain about the broader benefits of such digital assets beyond cross-border payments.