Tokenised Deposits
Reviewed by Jack Shrimpton, Senior Finance Content and Production Manager at xUnlocked · Last updated August 2026 Tokenised deposits are digital representations of bank deposits recorded on programmable infrastructure, such as a blockchain or other distributed ledger. Like an ordinary deposit, they remain a direct claim on the issuing commercial bank, but the technology may allow them to be transferred, settled or used in automated transactions through digital networks. They differ from most stablecoins because they remain part of the established bank deposit framework rather than being separate tokens supported by their own backing and redemption arrangements. This allows banks to explore faster, potentially round-the-clock and programmable payments while maintaining the existing relationship between the bank and its customer.
How do tokenised deposits differ from stablecoins?
- Issuer. Tokenised deposits are issued by regulated, deposit-taking banks. Stablecoins are typically issued by non-bank crypto companies, even when fully backed by reserves.
- Legal status. A tokenised deposit remains a bank liability, covered by the same banking rules that apply to that institution, such as deposit protection where the customer and product meet the relevant eligibility requirements. A stablecoin represents a claim or right determined by its particular legal, reserve and redemption arrangements.
- Settlement. Depending on their design, tokenised deposit transfers may settle in central bank money or through interoperable commercial-bank-money arrangements. Stablecoins settle independently of that system, which is part of why regulators have paid close attention to how reliably they hold their peg.
- Purpose for banks. Tokenised deposits allow banks to offer potentially faster, round-the-clock payments and programmable or conditional transactions while preserving the direct relationship between the customer and a regulated deposit-taking institution.
Why are banks building tokenised deposit infrastructure now?
Banks are exploring tokenised deposits to combine some of the capabilities of blockchain-based payments with the established commercial banking system. Potential uses include round-the-clock liquidity transfers, automated treasury transactions, conditional payments and the settlement of tokenised financial assets.
They may also allow banks to retain deposits as liabilities on their balance sheets while operating within established prudential, compliance and risk-management frameworks. This contrasts with payments made using stablecoins, where the customer instead holds a claim determined by the stablecoin issuer’s own legal and reserve arrangements.
Several banks and financial-market infrastructures are developing services and shared networks intended to make tokenised deposits transferable across institutions and compatible with existing payment systems. However, most current services remain focused on institutional clients and operate within specific banks or controlled networks.
What are the main challenges facing tokenised deposits?
Interoperability. A tokenised deposit issued by one bank doesn't automatically work with another bank's system, which is exactly why an industry-wide network like The Clearing House's is being built — without it, tokenised deposits risk becoming a collection of incompatible walled gardens rather than a genuinely faster payment rail.
- Regulatory clarity. While tokenised deposits fit more naturally into existing banking regulation than stablecoins do, supervisory frameworks for how they should be treated at scale — particularly across borders — are still being worked out.
- Legal and regulatory treatment. Rules around the transfer of deposit claims, settlement finality, insolvency, deposit protection, customer identification and cross-border transactions may differ by jurisdiction and product design.
- Operational and technology risk. New ledgers, digital wallets, smart contracts and third-party technology providers can create cybersecurity, operational-resilience and governance risks.
- Liquidity and funding risk. More easily transferable deposits could behave differently during periods of stress, potentially affecting how quickly funds leave a bank and how institutions manage liquidity and funding.
- Adoption and scale. Many tokenised deposit services remain limited to institutional customers, individual banks or controlled networks. Their wider success will depend on customer demand, legal certainty, interoperability and integration with existing financial infrastructure.
For the underlying technology tokenised deposits are built on, distributed ledgers, the difference between centralised and decentralised blockchains, and the smart contracts that enable the "contingent execution" the BIS points to, see Introduction to Blockchain, a video module presented by Igor Pejic, Fintech and Blockchain Leader.
Frequently asked questions
Are tokenised deposits the same as central bank digital currencies (CBDCs)?
No. A CBDC is a digital form of central bank money — a direct liability of the central bank itself, equivalent to digital cash. A tokenised deposit is a digital form of commercial bank money — a liability of the individual bank where the account is held, just as an ordinary deposit is today. Tokenised deposits are designed to settle in or alongside central bank money, but they aren't central bank money themselves.
Why would a bank prefer tokenised deposits over stablecoins?
Because stablecoins, even bank-friendly ones, sit outside the traditional deposit-taking system — money that moves into stablecoins is money that's left the banking system banks rely on for lending. Tokenised deposits let banks offer similar speed and programmability while keeping funds inside their own balance sheets and within existing deposit protection and regulatory frameworks, rather than ceding that ground to non-bank issuers.
What does "singleness of money" mean, and why does it matter for tokenised deposits?
Singleness of money is the principle that all forms of money in an economy should be worth exactly the same and freely interchangeable at par — a dollar in a bank account, a dollar in cash, and a tokenised dollar should never trade at different values. The BIS has argued that tokenised deposits, because they settle in or alongside central bank money and remain regulated bank liabilities, support this principle more reliably than stablecoins, which as bearer instruments can in theory depart from a strict 1:1 peg.
