Last week, the Wall Street Journal (WSJ) reported that The Clearing House had launched plans to build a tokenized deposit network. The Clearing House is owned by JP Morgan Chase, Bank of America, Citigroup, Wells Fargo and other large commercial banks.
Details on the effort were scant, other than the target launch date in 2027. The report also said that a vendor had not yet been chosen for the project.
“The big banks have come to the same conclusion that IBAT reached and first discussed a year ago,” said IBAT President and CEO Christopher Williston. “Banks’ participation in the next wave of financial innovation through the blockchain is dependent on tokenizing existing deposits, not the use of stablecoins, which are more appropriate for non-banks.”
Since launching the DTX Consortium for tokenized deposits in December, IBAT has heard from many member banks expressing concern that big banks would team up to dictate the terms in the building of a tokenized deposit network.
“With the announcement from The Clearing House last week, it’s more important than ever that community banks band together to build their own future in tokenized deposits,” Williston said. “Nothing will keep our network from being interoperable with others, but we must avoid a repeat of Zelle, where the big banks pushed technology down to us as a cost center only.”
Membership in the DTX consortium has reached more than 50 banks since its launch. To learn more about DTX contact Julie Courtney ([email protected]).
