America's biggest banks-JPMorgan, Bank of America, and Citi-are joining forces to build a shared tokenized deposit network by the first half of 2027. The move aims to protect their deposit base from the growing threat of stablecoins, which offer faster, cheaper payments and could soon pay returns under the advancing Clarity Act legislation.
The network will be operated by The Clearing House, a payments company collectively owned by the banks. Tokenized deposits are blockchain-based representations of customer funds held at a bank, enabling quick transfers on a distributed ledger. Insiders tell the Wall Street Journal the system is being called "the bridge" or "the chain."
Stablecoins, issued by crypto firms outside traditional banking, could trigger a deposit flight if widely adopted. Banks rely on deposits to extend credit, making this network a defensive strategy to keep funds within the system while adding crypto-like capabilities.
The Clearing House expects large multinationals to use the network for programmable treasury management, real-time liquidity, and cross-border payments. CEO David Watson called it "a big move for the banks" and a "radically different" future for onchain payments.