Bank of New York Mellon launched tokenized deposit services Friday, enabling institutional clients to transfer funds using blockchain rails.
The custodian holding $57.8 trillion in assets created digital representations of client deposits on a private, permissioned blockchain.
Early participants include Intercontinental Exchange, Citadel Securities, Anchorage Digital, DRW Holdings, Circle, Ripple Prime, Baillie Gifford, WisdomTree, and Zero Hash.
BNY's move follows similar blockchain initiatives from JPMorgan Chase and HSBC as traditional finance rebuilds legacy infrastructure.
What Happened
The tokenized deposits mirror client balances held at BNY, allowing near real-time settlement for collateral and margin transactions.
The bank built the service on a permissioned blockchain integrated with existing systems while maintaining traditional record-keeping for regulatory compliance.
BNY Chief Product and Innovation Officer Carolyn Weinberg said the service extends "trusted bank deposits onto digital rails" within a framework designed for regulatory alignment.
The launch follows passage of the GENIUS Act, which established federal regulatory frameworks for digital assets including stablecoins.
Tokenized deposits differ from stablecoins by remaining within the banking system and maintaining the ability to pay interest.
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Why It Matters
U.S. regulators signaled support for blockchain-based financial infrastructure in a September 2025 joint statement from the SEC and CFTC.
The agencies announced they would consider expanding trading hours toward 24/7 operations, noting blockchain technology enables around-the-clock settlement.
JPMorgan expanded its JPM Coin to institutional clients in November, while HSBC plans to launch tokenized deposits for U.S. and UAE corporate clients in 2026's first half.
BNY's permissioned blockchain approach contrasts with public blockchains, trading decentralization for regulatory compliance and institutional-grade security.
The bank positions tokenized deposits as foundational infrastructure for broader securities tokenization including stocks and bonds.
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