Tokenized deposits vs stablecoins: the bank-money angle

What a tokenized deposit is

A tokenized deposit is a bank deposit whose ownership is recorded and transferred on a distributed ledger (a shared, append-only database such as a blockchain) instead of only in the bank’s internal core system. Legally nothing changes: the customer still holds a claim on the bank, the bank still counts the money as a deposit liability, and the funds sit inside the bank’s capital, liquidity and supervisory regime.

That is the core difference from a stablecoin. A payment stablecoin is a claim on an issuer that must hold separate reserves, typically cash and short-term Treasuries, at least one for one. The issuer does not lend those reserves out. A bank, by contrast, lends against its deposits under fractional reserve banking, which is why deposits come with capital rules, central bank liquidity and deposit insurance, and stablecoins come with reserve and redemption rules instead.

The practical consequence: a tokenized deposit is a new way to move existing bank money, while a stablecoin is a different form of money that sits outside the deposit base. Our separate guides cover stablecoins and the GENIUS Act and CBDCs versus stablecoins; this guide focuses on the bank side.

How the regulation treats each

The GENIUS Act, signed in July 2025, created a federal regime for payment stablecoin issuers. Under the FDIC’s proposed implementing rule, published April 10, 2026, the definition of a deposit explicitly includes “deposits in tokenized form,” and tokenized deposits are carved out of the payment stablecoin definition. In plain terms, a tokenized deposit is regulated as a deposit, not as a stablecoin.

The same proposal says that bank deposits held as stablecoin reserves would be insured to the issuer as a corporate depositor, not passed through to individual token holders. Comments closed June 9, 2026, and the rule had not been finalized as of early October 2026.

• OCC. Its GENIUS Act proposal (February 25, 2026) lets subsidiaries of insured banks become permitted stablecoin issuers with regulator approval and would ban issuers from paying interest or yield, with a rebuttable presumption against affiliate and third-party yield arrangements.
• Federal Reserve. In September 2026 the Fed proposed reserve, capital, redemption and risk-management rules for the stablecoin issuers it supervises, with a 60-day comment period.
• Capital treatment. On March 5, 2026 the OCC, Fed and FDIC said in joint FAQs that the technology used to issue a security, permissioned or public chain, does not by itself change its regulatory capital treatment.
• State supervisors. The Conference of State Bank Supervisors asked federal agencies in November 2025 to confirm in joint guidance that a deposit recorded on a ledger is insured exactly like any other deposit.

One asymmetry matters for treasurers: stablecoin issuers cannot pay interest under the GENIUS Act, while a bank can in principle pay interest on a tokenized deposit as it can on any deposit account.

The main bank programs

• JPMorgan Kinexys. JPMorgan’s blockchain unit runs Blockchain Deposit Accounts on a permissioned ledger and, since November 12, 2025, the JPMD deposit token on Base, a public layer-2 network, for institutional clients only. In June 2026 it added five Asia-Pacific currencies, bringing the network to eight, and reported average daily volume above $7 billion. A phased deployment on the Canton Network is under way in 2026.
• Citi Token Services. Citi’s tokenized deposit service lets corporate clients move funds between Citi accounts around the clock, without cut-off times. On September 28, 2026 it added Japan and the UAE, for seven live markets. Citi has not published 2026 volume figures.
• HSBC Tokenised Deposit Service. Live in the UK, Hong Kong, Singapore and Luxembourg, HSBC extended it to the US on April 13, 2026 and to the UAE in June 2026, supporting five currencies for corporate clients.
• Societe Generale (SG-Forge). SocGen took the other route: EURCV and USDCV are stablecoins issued by its digital asset subsidiary under the EU’s MiCA rules, designed to circulate on public chains rather than staying inside the bank.

Bank consortia and shared infrastructure

The largest US banks are pooling efforts rather than each running a closed network. On June 5, 2026 The Clearing House, owned by major US banks and operator of the CHIPS and RTP payment systems, announced a shared tokenized deposit network with a target launch in the first half of 2027. On September 24, 2026 it selected Quant to provide interoperability and connections back to existing payment rails. Jefferies analysis cited by CoinDesk estimated stablecoins could pull 3% to 5% of deposits out of banks over five years, which explains the urgency.

In Europe, banks are building a stablecoin instead. Qivalis, an Amsterdam-based joint venture, counted 37 member banks after adding 25 in May 2026. As of September 2026 it was still awaiting e-money institution authorisation from De Nederlandsche Bank, with a target launch in the second half of 2026 on public Ethereum.

At the wholesale level, the BIS-led Project Agora tests a unified ledger: tokenized commercial bank deposits on one layer and tokenized central bank reserves on another, so a payment and its settlement happen in one step. Its May 29, 2026 report, covering more than 40 financial institutions and seven central banks, found cross-border payments could settle in seconds. The next phase moves toward real-value transactions, with the Bank of Canada joining.

Risks and open questions

• Fragmentation. Each bank’s token works best inside its own client network. Without shared rails like The Clearing House effort or Agora, a JPMD and a Citi token are not directly interchangeable.
• Reach. Tokenized deposits are mostly restricted to vetted institutions, so they compete with stablecoins for corporate treasury and settlement flows, not for open on-chain use.
• Bank credit risk. Insurance covers $250,000 per depositor per bank. Large corporate balances above that remain exposed to the bank itself, as with any deposit.
• Rules still in draft. The FDIC, OCC, Fed and Treasury GENIUS Act rules were proposals as of early October 2026, and the Act takes effect no later than January 2027.

What to watch next

• Final FDIC and OCC rules, and whether the deposit definition covering tokenized form survives intact.
• Vendor build-out and participant list for The Clearing House network ahead of its 2027 target.
• Qivalis authorisation and launch, a test of whether banks can win share in bank-issued stablecoins.
• Whether JPMD or other deposit tokens open to a wider set of holders on public chains.

Sources and further reading

• FDIC proposed rule on GENIUS Act standards, including tokenized deposits (Federal Register, April 10, 2026)
• OCC Bulletin 2026-7: interagency FAQs on capital treatment of tokenized securities
• CoinDesk: JPMorgan broadens Kinexys settlement network (June 29, 2026)
• Citi: Citi Token Services expands to Japan and the UAE (September 28, 2026)
• CoinDesk: US banks plan shared tokenized deposit network via The Clearing House (June 6, 2026)
• Payment Expert: BIS Project Agora update (May 29, 2026)