Four of the largest U.S. banks — JPMorgan Chase, Citigroup, Bank of America, and Wells Fargo — are building a shared blockchain network to tokenize commercial bank deposits, with a target launch in the first half of 2027. The Clearing House, jointly owned by the participating banks, will operate ...
"We face a radically different future around on-chain payments." — David Watson, CEO, The Clearing House
Four of the largest U.S. banks — JPMorgan Chase, Citigroup, Bank of America, and Wells Fargo — are building a shared blockchain network to tokenize commercial bank deposits, with a target launch in the first half of 2027. The Clearing House, jointly owned by the participating banks, will operate the infrastructure. No blockchain vendor has been selected. The project, referred to internally as "the bridge" or "the chain," represents the most coordinated institutional response to stablecoin competition to date.
Separately, five regional banks — Huntington Bancshares, First Horizon, M&T Bank, KeyCorp, and Old National Bancorp — are constructing the Cari Network on ZKsync's Prividium infrastructure, with a pilot planned for Q3 2026 and commercial rollout in Q4. Together, the two initiatives signal that the U.S. banking system is moving to convert traditional deposits into programmable, blockchain-native instruments — while keeping funds inside the regulated perimeter.
The stakes are structural: the stablecoin market has grown to approximately $307.5 billion in total supply, with USDT at $186.8 billion and USDC at $75.8 billion. Banks view tokenized deposits as a way to retain deposit funding, preserve credit creation capacity, and preempt both stablecoins and central bank digital currencies. Whether this works depends on whether programmability and 24/7 settlement can overcome the network effects stablecoins have already built.
The shared tokenized deposit network announced in early June 2026 is designed to enable real-time, 24/7 settlement between participating institutions. The system will tokenize traditional commercial bank deposits — converting them into blockchain-based tokens that can move continuously, including on weekends and federal holidays — while keeping funds as liabilities on bank balance sheets.
The Clearing House, which currently processes more than $2 trillion in payments daily across wire, ACH, check image, and real-time payment rails, will manage the infrastructure. Its CHIPS network alone settles approximately 500,000 payments totaling $1.8 trillion per day. Its RTP network set a daily record of over 2 million transactions and $8.36 billion in payments in February 2026.
Key technical specifications remain undetermined. No blockchain vendor has been selected. The network's permissioning model, consensus mechanism, and interoperability standards are still in development. The first-half 2027 target gives roughly 12 months for vendor selection, testing, and regulatory coordination.
According to Mark Monaco, Bank of America's global payments head, clients are not "beating down the door" for tokenized deposits — but interest exists. Shahmir Khaliq, Citi's head of services, framed the network as positioning banks with strength in capital markets and financing. The initial target market is large multinational corporations, drawn to cross-border payments and intraday liquidity management.
The Big Four are not alone. Five regional banks — Huntington Bancshares, First Horizon, M&T Bank, KeyCorp, and Old National Bancorp, with combined assets ranging from $72 billion to $225 billion each — are building the Cari Network on Prividium, a private permissioned blockchain developed by Matter Labs, the team behind ZKsync.
The Cari Network uses a single shared token rather than bank-specific tokens. All five institutions issue and redeem the same instrument, enabling peer-to-peer and business-to-business transfers regardless of which bank each party uses. The deposits remain direct liabilities of the participating banks, preserving existing regulatory protections.
Timeline: pilot covering issuance, transfers, and redemptions in Q3 2026; full commercial launch in Q4 2026. If achieved, Cari would reach market before the Big Four network.
The regional bank initiative highlights a pattern: tokenized deposits are not a single-firm experiment. They are becoming an industry-wide infrastructure play, with both the largest and mid-tier banks building parallel networks.
The distinction between tokenized deposits and stablecoins is not semantic — it is structural.
Stablecoins (e.g., USDT, USDC) are digital tokens pegged to a currency, issued by non-bank entities, and backed by reserves such as Treasury bills or cash equivalents. Those reserves sit outside the banking system. When a user holds USDC, they hold a claim on Circle's reserve pool, not on a bank's balance sheet. Stablecoins do not carry FDIC insurance.
Tokenized deposits are commercial bank deposits recorded as transferable tokens on a blockchain. Each token represents a direct claim on a specific bank's balance sheet. The bank retains the deposit, can continue lending against it, and the full weight of existing banking regulation — capital requirements, supervisory oversight, and potentially FDIC insurance — applies.
This distinction matters for credit creation. When deposits move to stablecoins, they leave the banking system. The issuer holds reserves in Treasuries or money market instruments — they do not lend. A dollar that moves from a bank account to USDC removes that dollar from the fractional reserve system. Tokenized deposits keep the dollar inside the bank, preserving the bank's ability to lend multiples of it.
For banks, this is existential. The stablecoin market has grown from near zero to $307.5 billion in supply, with two issuers — Tether and Circle — controlling 88.6% of the market. Every dollar in stablecoin supply is, in theory, a dollar that left a bank deposit.
JPMorgan is the furthest along. Its Kinexys platform — operating as a blockchain business unit since 2015 — has processed more than $3 trillion in cumulative transactions and now averages more than $5 billion daily. The platform supports institutional payments, cross-border settlement, and programmable payment execution.
In November 2025, JPMorgan deployed JPM Coin (JPMD) on Base, the Ethereum Layer-2 network developed by Coinbase. The token is available to institutional clients for cross-border payments, intraday liquidity transfers, on-chain collateral posting, and programmable payouts. A euro-denominated version (JPME) is in development, pending EU regulatory approval.
The Base deployment is notable: it places a bank deposit token on a public Layer-2 network, albeit restricted to institutional participants. JPMorgan has also expanded Kinexys partnerships with BMW Group, FirstRand Bank, Mitsubishi Corporation, B2C2, and Siemens.
Kinexys provides a baseline for what the shared Big Four network aspires to build at industry scale. The $5 billion daily volume demonstrates institutional demand exists. The question is whether a multi-bank shared ledger can replicate this without the coordination overhead that typically slows consortium projects.
The regulatory treatment of tokenized deposits occupies a distinct lane from stablecoins.
The GENIUS Act, signed into law in July 2025, established a comprehensive framework for payment stablecoins — requiring 100% reserves, imposing disclosure requirements, and routing non-bank issuers through the OCC or state regulators. On March 2, 2026, the OCC published proposed rules implementing the Act. On April 7, 2026, the FDIC Board approved its own proposed rulemaking for FDIC-supervised stablecoin issuers.
Tokenized deposits fall outside the GENIUS Act's scope. The Act explicitly preserves existing banking authority for financial institutions and states that the technology used to record a deposit — including use of a digital ledger — does not affect deposit insurance applicability. In principle, a tokenized deposit can qualify as an insured deposit if it meets the statutory definition.
In practice, no regulator has issued explicit guidance confirming FDIC coverage for tokenized deposits in all configurations. The working assumption among participating banks is that coverage applies because the underlying instrument — a commercial bank deposit — remains unchanged. The token is a record-keeping mechanism, not a new financial product. Whether regulators endorse this view formally will determine institutional adoption speed.
The FDIC's March 2025 decision to rescind earlier guidance restricting banks from crypto-related activities (FIL-16-2022) further opened the door. Banks no longer need prior FDIC approval to engage in permissible crypto activities, including tokenized deposit experimentation.
The economic dynamics of tokenized deposits differ from those of stablecoins in ways that matter for value distribution.
Stablecoin economics concentrate value at the issuer level. Tether generated approximately $13 billion in revenue in 2024, primarily from interest on Treasury reserves backing USDT. Circle's USDC generates interest income shared with distribution partners — Coinbase receives 100% of interest income from USDC held on its platform and splits off-platform income with Circle. Coinbase's stablecoin revenue reached approximately $300 million in Q1 2025 alone, representing about 15% of total revenue.
Tokenized deposit economics keep value within the banking system. The bank retains the deposit, earns net interest margin by lending against it, and charges fees for the programmable payment infrastructure. No intermediary captures the spread between deposit rates and Treasury yields — the bank does, as it always has.
For The Clearing House, the shared network could generate revenue through transaction fees, similar to its existing CHIPS and RTP networks. The $2 trillion daily volume flowing through its current infrastructure provides a revenue base that a tokenized deposit layer could expand by adding 24/7 settlement and programmable payment capabilities.
The open question is interoperability. If the Big Four network, the Cari Network, and individual bank platforms like Kinexys cannot exchange tokenized deposits seamlessly, the ecosystem fragments. Stablecoins — which operate on public, permissionless networks — have an inherent interoperability advantage. USDC moves between any wallet on any supported chain without institutional coordination. Tokenized deposits will need to match this convenience or accept a narrower use case.
The U.S. banking system is attempting to absorb blockchain technology rather than compete against it. The Big Four shared network and the Cari Network represent two bets on the same thesis: that regulated, FDIC-eligible, balance-sheet-backed digital dollars can deliver the programmability and settlement speed of stablecoins without the regulatory ambiguity or deposit flight.
The economic incentive is clear. Banks stand to lose deposit funding — and the credit creation capacity that comes with it — to stablecoin issuers who park reserves in Treasuries and do not lend. Tokenized deposits are the banking system's answer: same speed, same programmability, but the money stays inside the bank.
Whether this succeeds depends on execution. Consortium blockchain projects have a mixed track record. The technology must work across institutions. Regulators must confirm FDIC treatment. And the networks must achieve enough interoperability to compete with the frictionless transfer experience stablecoins already provide. The first live transactions on the Cari Network, expected in Q3 2026, will provide the earliest signal of whether tokenized deposits can move from pilot to production.