TL;DR
- BNY Mellon launched a tokenized deposit service for institutional clients, representing bank balances on-chain.
- The product enables the use of tokenized deposits for collateral, margin, and institutional payments, with 24/7 transfers.
- The rollout began with six clients, including ICE and Citadel Securities.
BNY Mellon launched a tokenized deposit service for institutional clients that allows funds to move over blockchain rails based on balances held in the bank’s traditional accounts. The bank creates an on-chain representation of those deposits and keeps the funds within the regulated banking perimeter, with direct 1:1 backing on its balance sheet.
The service converts client balances into tokenized deposits that can circulate on blockchain networks and synchronize with the bank’s core systems. The structure does not create a standalone asset or a stablecoin. The tokenized deposits are direct liabilities of BNY Mellon, accrue interest, and continuously reflect the actual account position. The system relies on on-chain programmability to execute transfers and settlements with precise timing.
24/7 Transfers and Reconciliation
BNY Mellon launched the service for an initial group of six institutional clients. These include Intercontinental Exchange, Citadel Securities, DRW Holdings, Ripple Prime, Baillie Gifford, and Circle Internet Group. ICE confirmed it will work to support these deposits across its clearinghouses on a continuous basis.
The bank will focus the product on collateral and margin movements within trading and clearing workflows, as well as high-value institutional payments. The structure targets operations that require intraday liquidity and immediate settlement, including outside the operating hours of traditional payment systems. The operational objective is to provide 24/7 transfers that are later reconciled with banking records.
BNY Mellon Positions a Banking Alternative to Stablecoins
BNY has moved from an exploratory phase to a production-grade financial utility. BNY Mellon’s treasury unit processes close to $2.5 trillion per day, and the rollout integrates into that existing infrastructure. The bank frames tokenized deposits as a banking-based alternative for institutional settlement compared with stablecoins.
The launch follows regulatory progress in the United States after the passage of the U.S. Genius Act, which established a framework for dollar-backed digital money. Other major banks are advancing similar initiatives. JPMorgan expanded the use of JPM Coin and announced the issuance of its deposit token on the Canton network. HSBC said it plans to expand its tokenized deposit service to corporate clients in the United States and the United Arab Emirates. Barclays acquired a stake in the startup Ubyx to explore tokenized money
