Vast Bank Plans Retail Tokenized Deposit Service This Year

Tokenized deposits represent claims on commercial banks recorded as digital tokens on a blockchain, rather than privately issued stablecoins backed by reserve assets. They could enable near-instant payments and settlement while preserving the established relationship between banks and depositors. Their adoption matters because lenders must carry existing know-your-customer, anti-money-laundering and deposit-regulation obligations into blockchain-based financial infrastructure.

Traditional banks are now exploring how to issue and transfer tokenized deposits through permissioned blockchain networks. Restricting access to verified participants and approved nodes offers a potential route to protect client information while allowing regulatory oversight and transaction traceability. The report identified no individual bank, launch date or issuance amount, indicating that the effort remains focused on developing compliant technology and governance frameworks rather than announcing a commercial rollout.

Tokenized deposits represent companies' fiat deposits as digital tokens on a distributed ledger, but remain bank deposits rather than stablecoins. HSBC uses the technology to help multinational companies manage liquidity around the clock and reduce delays caused by batch settlement, time-zone differences and traditional cross-border payments. The service is an important indicator of banks' progress in commercializing on-chain payments.

HSBC announced on April 13, 2026, that its Tokenized Deposit Service (TDS) had formally expanded to the United States, allowing eligible corporate and institutional clients to transfer funds instantly between domestic and cross-border accounts. The service was already available in Hong Kong, Singapore, Luxembourg and the United Kingdom, bringing its reach to five markets with the addition of the United States. HSBC did not disclose transaction values or the scale of the service.

Tokenized deposits are digital representations of bank deposits on a blockchain and remain liabilities of the issuing banks, subject to deposit protection, capital and anti-money laundering rules. Alongside stablecoins and central bank digital currencies, they could underpin onchain payments while preserving commercial banks’ role in money creation and settlement.

RWA.io disclosed the report on March 23, 2026, incorporating views from UK Finance, Citi, BNY, JPMorgan’s Kinexys and Standard Chartered, among others. Lloyds Banking Group and Archax completed the United Kingdom’s first public-blockchain tokenized deposit transaction on Canton Network in January that year, but did not disclose the amount. Seven other major banks and building societies are participating in the pilot, with testing expected to continue until mid-2026.