Twenty of the largest U.S. commercial banks are building three separate tokenized deposit networks, aiming to convert traditional bank liabilities into blockchain-native tokens that settle around the clock. The largest initiative — a shared network operated by The Clearing House and backed by JPM...
"A big move for the banks. The industry faces a radically different future around on-chain payments." — David Watson, CEO, The Clearing House
Twenty of the largest U.S. commercial banks are building three separate tokenized deposit networks, aiming to convert traditional bank liabilities into blockchain-native tokens that settle around the clock. The largest initiative — a shared network operated by The Clearing House and backed by JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, and at least a dozen additional lenders — targets a first-half 2027 launch. Two smaller efforts are already further along: Anchorage Digital Bank launched turnkey deposit-token infrastructure for partner banks on June 22, 2026, and the Cari Network, a consortium of five regional banks building on ZKsync, plans a customer-facing pilot in Q3 2026.
The coordinated push comes as the stablecoin market reaches $307.5 billion in aggregate supply, with Citigroup research projecting growth to $1.6–3.7 trillion by 2030. Jefferies estimates that stablecoins could drive 3–5% deposit runoff over five years and reduce average bank earnings by approximately 3%. The banking system's response is not to adopt stablecoins but to replicate their speed while keeping funds inside FDIC-insured balance sheets.
The U.S. banking sector is pursuing tokenized deposits through three parallel tracks, each at a different stage of development and targeting different segments of the market.
The Clearing House Network. JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, BNY, BMO, Citizens Financial, Fifth Third, HSBC, Huntington, KeyBank, PNC, Regions, Santander, TD Bank, Truist, and U.S. Bank have committed to a shared network operated by The Clearing House, the real-time payment company co-owned by these same institutions. The system will tokenize customer deposits and move them across blockchain rails with instant, 24/7 settlement. A blockchain vendor has not been selected. The target launch is the first half of 2027.
"Clients aren't beating down the door for tokenized deposits, but the network ensures banks are positioned when demand builds," said Mark Monaco, Head of Global Payments Solutions at Bank of America. "With any sort of new adoption, it takes time."
The Cari Network. Five regional banks — First Horizon, Huntington Bancshares, KeyCorp, M&T Bank, and Old National Bancorp — are building a separate tokenized deposit network on Prividium, a private, permissioned blockchain developed by Matter Labs using ZKsync technology. Led by former Comptroller of the Currency Gene Ludwig, the network released a minimum viable product in March 2026, plans a pilot in Q3, and targets commercial rollout by year-end. Tokens issued on the Cari Network represent standard bank liabilities and retain FDIC insurance.
Anchorage Digital. The OCC-chartered crypto bank launched a turnkey tokenized deposit platform on June 22, 2026, designed for banks that want to issue deposit tokens without overhauling core systems. Anchorage provides blockchain infrastructure, wallet management, and smart-contract technology. Customer data stays within the issuing bank. "Tokenized deposits aren't about replacing the trust banks have built, they're about enhancing it," said Nathan McCauley, Co-Founder and CEO of Anchorage Digital.
The scale of the perceived threat explains the speed of the response. The stablecoin market has grown from $229.2 billion in April 2025 to $307.5 billion as of June 2026. Tether (USDT) holds $188 billion in supply, USDC holds $75.8 billion, and together they account for roughly 92% of the total market.
Citigroup's GPS research unit projects stablecoin supply will reach $1.6 trillion by 2030 in its base case and $3.7 trillion in its bull case — revised upward in early 2026 to $1.9 trillion and $4.0 trillion, respectively. The bank estimates that at these levels, stablecoins could displace $182–908 billion in bank deposits.
Jefferies puts the nearer-term risk at 3–5% deposit runoff over five years, translating to an approximately 3% drag on average bank earnings. The U.S. Treasury's borrowing advisory committee has separately identified $6.6 trillion in U.S. transactional deposits as "at risk" from stablecoin substitution.
The Bank Policy Institute has argued that yield-bearing stablecoins — if permitted under future regulatory amendments — could accelerate the deposit drain further. The GENIUS Act, enacted July 18, 2025, currently prohibits interest payments on stablecoins. The OCC published a Notice of Proposed Rulemaking on March 2, 2026, reinforcing that prohibition with a rebuttable presumption against indirect yield arrangements.
The distinction is structural, not cosmetic.
Stablecoins are issued by non-bank entities, backed by reserve assets (typically Treasury bills and cash equivalents) held outside the banking system. They operate on public, permissionless blockchains. Holders have a claim on the issuer's reserve, not on a bank. They are not FDIC-insured.
Tokenized deposits are digital representations of traditional bank deposits on a blockchain. The underlying funds remain on the issuing bank's balance sheet. Holders have the same legal claim as any depositor. They carry the same credit-risk profile, regulatory treatment, and accounting standards as conventional deposits. They are eligible for FDIC insurance up to statutory limits.
According to a February 2026 Federal Reserve Bank of New York staff report by Xuesong Huang and Todd Keister, the choice between these instruments involves trade-offs around credit creation. Stablecoins backed by safe assets crowd out bank lending but eliminate deposit-side risk. Tokenized deposits preserve the bank credit channel but introduce traditional banking risks to on-chain activity. The researchers found that allowing both instruments to compete is welfare-optimal under intermediate regulatory conditions.
JPMorgan operates the most advanced tokenized deposit platform among the consortium members. Kinexys, the bank's blockchain-based payment network, processes more than $5 billion daily as of April 2026, with cumulative volume exceeding $3 trillion since inception. The platform issues JPM Coin (ticker: JPMD), a USD-denominated deposit token available to institutional clients.
In 2026, Kinexys expanded its footprint by launching JPM Coin on Base, Coinbase's Layer-2 network, for institutional clients. The platform is targeting $10 billion in daily throughput. Kinexys has also completed cross-chain tokenized asset settlement tests in collaboration with Chainlink and Ondo Finance.
JPMorgan's existing infrastructure gives the bank a structural advantage within the Clearing House consortium. However, it also creates a coordination challenge: other participating banks must build comparable token-issuance capabilities before the shared network can function at scale.
The Cari Network represents a different approach. Rather than waiting for a consortium-wide build, five mid-size banks are moving faster with a smaller group and a specific technology choice.
The network uses Prividium, a private, permissioned blockchain built by Matter Labs. "Financial infrastructure is undergoing the same shift computing went through decades ago, from siloed databases to shared, programmable infrastructure," said Alex Gluchowski, CEO of Matter Labs. "With Prividium, banks can issue and move deposits on blockchain infrastructure while preserving the privacy, compliance, and control required by regulated institutions."
Gene Ludwig, Cari's CEO and former Comptroller of the Currency, framed the initiative in competitive terms: "Banks should be leading the next phase of digital money, not reacting to it."
The Cari Network's Q3 2026 pilot timeline puts it at least six months ahead of the Clearing House network's planned launch.
Anchorage Digital's June 22 launch takes a third approach: rather than forming a consortium, it offers deposit-token infrastructure as a service to any regulated bank. The platform runs as a parallel layer alongside a bank's existing core systems, with Anchorage claiming a go-live timeline of weeks rather than the three-to-seven-year migration cycles typical of core banking replacements.
Key design choices include zero external storage of personally identifiable information (customer data stays within the issuing bank) and programmable settlement via smart contracts. Anchorage Digital Bank N.A. received its OCC federal charter on January 13, 2021, making it the first federally chartered crypto bank in the United States.
The infrastructure-as-a-service model could accelerate adoption among the roughly 4,500 FDIC-insured commercial banks in the U.S. that lack the resources to build proprietary blockchain platforms.
The consortium's members are not unified in their posture toward stablecoins. Citigroup illustrates the split.
Citi is simultaneously a founding member of the Clearing House tokenized deposit network and a partner with Coinbase on stablecoin payment capabilities for institutional clients. The Citi-Coinbase partnership, announced October 27, 2025, focuses initially on fiat-to-crypto pay-ins and pay-outs, with plans to extend to 24/7 stablecoin-based payments. Citi also operates its own Token Services platform, processing real-time digital transfers between New York, London, and Hong Kong.
Shahmir Khaliq, Head of Services at Citi, described the tokenized deposit network as "another step that effectively cements" the role banks play in financing and capital markets. The bank appears to view tokenized deposits and stablecoins as complementary instruments serving different use cases — deposit tokens for interbank settlement and treasury operations, stablecoins for open-ecosystem payments and cross-border flows.
"Following the GENIUS Act, a competition seems to be emerging between stablecoins, tokenized deposits and tokenized money market funds to become the preferred onchain cash instrument," said Reid Noch, Vice President of U.S. Equity Market Structure at TD Securities.
The Federal Reserve has not endorsed either instrument but has published research framing the trade-offs.
The New York Fed's February 2026 staff report found that banks holding stablecoin-issuer deposits tend to hold more reserves and lend less, a pattern consistent with the "narrow banking" dynamic that regulators have historically resisted. The Silicon Valley Bank collapse in 2023 provided a case study: stablecoin reserves concentrated in a small number of banking partners created correlated withdrawal risk.
Separately, a Federal Reserve Board staff note published May 1, 2026, titled "Banks in the Age of Stablecoins: Lessons from Their Historical Responses to Financial Innovations," examined how banks have historically responded to deposit-competitive products. The note concluded that banks typically adapt by raising deposit rates or developing substitute products — precisely the pattern now visible in the tokenized deposit push.
The U.S. banking system's coordinated move into tokenized deposits represents the largest institutional blockchain deployment since JPMorgan launched its internal JPM Coin in 2019. The economic logic is defensive: with stablecoin supply growing at roughly 34% annually and regulatory frameworks crystallizing under the GENIUS Act, banks face a choice between building competing on-chain infrastructure or ceding settlement and payment flows to non-bank issuers.
The outcome is not predetermined. Tokenized deposits carry structural advantages — FDIC insurance, existing customer relationships, regulatory familiarity — but also structural limitations. They require consortium coordination, they operate on permissioned networks with limited composability, and they depend on the same legacy core systems that blockchain proponents argue need replacing. Stablecoins, by contrast, are already live on public networks, integrated into DeFi protocols, and adopted for cross-border remittances.
The next 18 months will determine whether tokenized deposits can match stablecoin speed-to-market. The Cari Network's Q3 2026 pilot will provide the first real-world data. The Clearing House consortium's vendor selection — expected later in 2026 — will signal whether the largest banks are converging on a single technology stack or fragmenting into incompatible platforms. For the $6.6 trillion in U.S. transactional deposits identified as at risk, the race is now operational, not theoretical.