Binance founder Changpeng “CZ” Zhao backed Hong Kong as a potential Web3 and real-world asset hub during an August 27 book meeting in the city.

The event took place at Exchange Square in Central, according to the organizer. CZ discussed Hong Kong’s financial sector, tokenized securities and the development of decentralized exchanges. His comments represented personal forecasts rather than new Binance projects or investment commitments.

CZ says Hong Kong can connect finance with Web3

CZ said Hong Kong benefits from its status as a financial center, access to professionals from mainland China and established institutional relationships. He described Hong Kong and Web3 as a “powerful combination.”

He also named Dubai, Abu Dhabi and the U.S. as markets positioned to benefit from more supportive digital asset policies. These comments were assessments of their prospects. They did not include new licensing applications or expansion plans from Binance.

Hong Kong has introduced a broader regulatory structure covering exchanges, stablecoins and tokenized products. Its approach differs from mainland China, where authorities maintain tight restrictions on cryptocurrency trading and related activities.

The city’s policy direction has attracted financial institutions and asset managers. As crypto.news reported in its coverage of Hong Kong’s stablecoin and custody rules, regulators have sought to expand tokenized finance while retaining licensing and investor-protection requirements.

Hong Kong’s RWA market supports part of CZ’s forecast

CZ predicted that real-world assets would become a major area of Web3 development. He focused on tokenized securities, which can provide wider access beyond traditional market hours and national account systems.

He also described stablecoins as a form of RWA because they place claims linked to fiat currencies on blockchains. That description reflects a common industry classification, although the legal treatment of stablecoins differs between jurisdictions.

Hong Kong has already moved beyond small technical tests. The Securities and Futures Commission said 13 tokenized products were offered to the public as of March 2026. It subsequently introduced a framework covering tokenized products and their secondary-market trading.

The Hong Kong Monetary Authority is also operating EnsembleTX, the pilot phase of Project Ensemble. The pilot supports real-value transactions involving tokenized deposits and digital assets. It is scheduled to operate throughout 2026.

In related coverage, Franklin Templeton recently brought a tokenized U.S. government fund to HashKey, adding another distribution channel for regulated tokenized investments.

CZ expects DEX growth if U.S. pressure continues easing

CZ said decentralized exchanges have progressed from early platforms such as Uniswap and PancakeSwap to newer markets including Hyperliquid. He argued that better infrastructure and stronger user awareness have made DEXs more competitive.

He added that U.S. regulatory pressure appeared to have eased and said continued policy changes “may accelerate” DEX and broader crypto growth. That remains a forecast. Decentralized services can still face securities, commodities, sanctions and anti-money-laundering requirements, depending on their structure and operations.

The SEC and CFTC issued a joint crypto asset interpretation effective March 23. The agencies said clearer classifications could reduce perceived regulatory risk and encourage more U.S. activity. The document did not create a blanket exemption for DEX developers or interface operators.

Market data nevertheless show growing usage. As previously reported, DEX spot volume reached about 24% of covered centralized exchange volume in July. The comparison depends on the exchanges and methodology included.

Regulatory milestones will determine what happens next

Hong Kong’s next steps include implementing its tokenized product framework, continuing EnsembleTX and developing its licensed stablecoin market. Those programs will offer measurable evidence for or against CZ’s RWA forecast.

In the U.S., further SEC and CFTC rulemaking will determine whether decentralized platforms receive specific compliance routes. Until those rules are settled, claims that international DEXs can operate without full customer checks require jurisdiction-specific legal review.

Tokenized bank deposits—made possible by instant settlement and automated transfers—could destabilize bank funding and eventually raise borrowing costs for US households and businesses, according to an analysis by economists at the Federal Reserve Bank of Dallas.

In a report by Rosie Levy and Srini Ramaswamy, the authors argue that technologies enabling deposits to move more quickly between banks would make funding portfolios more sensitive to interest-rate changes. They frame their work as scenario-based modeling rather than a forecast of immediate outcomes, but the conclusions add a new risk lens as the banking sector accelerates shared infrastructure for tokenized settlement.

Key takeaways

• The Dallas Fed economists warn that instant settlement could let depositors chase higher yields faster, increasing deposit “rate sensitivity.”
• In their scenarios, a 10% increase in deposit sensitivity to interest rates could reduce banks’ capacity to hold long-term loans and assets by about $700 billion in 10-year equivalents.
• A separate scenario—deposits staying at banks for 10% less time—could lower that capacity by about $580 billion (also in 10-year equivalents).
• The analysis emphasizes that the figures are not direct, dollar-for-dollar reductions in lending, but reflect changes in banks’ balance-sheet room over time.
• Banks are already building networks intended to move tokenized deposits around the clock while keeping funds within regulated banking channels.

Why tokenized deposits may change bank funding dynamics

Levy and Ramaswamy’s central point is that deposit behavior could shift if tokenized deposits make it easier—potentially near-instantly—for customers to move their money between institutions. They note that programmable “deposit tokens” and automation tools, including agentic artificial intelligence, could reduce the friction typically associated with switching banks.

That, in turn, could affect the stability of deposit funding—a key input for how banks manage long-term lending. Traditional banking relies on the assumption that many depositors do not change banks immediately when yields move. If tokenized settlement shortens the window in which deposits remain with a particular bank, banks may face funding profiles that respond more rapidly to interest-rate changes.

What the Dallas Fed model suggests—interest-rate sensitivity and liquidity trade-offs

To illustrate potential impacts, the economists quantify two hypothetical scenarios. First, they estimate the effect if deposits become 10% more sensitive to interest rates. In their modeling, that increased sensitivity could reduce banks’ capacity to hold long-term loans and other assets by roughly $700 billion, expressed in 10-year equivalents.

Second, they model a situation where deposits remain at banks for 10% less time. Under that scenario, the reduction in banks’ capacity to hold long-term assets is estimated at about $580 billion in 10-year equivalents.

Levy and Ramaswamy stress that these are scenarios designed to capture balance-sheet sensitivity; they do not claim a direct dollar-for-dollar drop in lending. Still, their work connects funding volatility to potential credit tightening pressures: if banks cannot rely on stable deposits, they may need to adjust asset and funding structures to manage risk.

How banks could respond: more liquidity, more wholesale funding

Rather than predicting an inability to lend, the report outlines likely adjustments banks might make when facing more volatile deposits. The authors suggest banks could increase holdings of highly liquid assets—such as reserves and US Treasurys—to ensure they can meet withdrawal or transfer demands.

They also point to the possibility of relying more heavily on term debt to sustain lending portfolios. However, the report indicates that funding loans through wholesale debt could increase credit costs for consumers and businesses, which is where the consumer impact implied by “higher credit costs” enters the analysis.

In other words, even if tokenized deposits do not immediately shrink lending totals, they may alter the cost and structure of funding in ways that propagate to borrowers over time.

Infrastructure is already moving: networks for tokenized deposits and real-world linking

The analysis lands as the banking industry builds mechanisms intended to support tokenized deposits and automated settlement. On Tuesday, 39 US state banking associations formed the BankChain Alliance to develop a nationwide network for tokenized deposits, stablecoins, and automated settlement. Separately, The Clearing House is developing another network backed by major banks including JPMorgan Chase, Bank of America, Citi, BNY, and Wells Fargo.

Beyond broad network planning, banks have also started connecting systems across institutions. On Aug. 20, Standard Chartered and HSBC reported completing a live cross-border transaction using Swift’s blockchain ledger, which linked their respective tokenized-deposit systems and recorded obligations prior to settlement through existing payment infrastructure.

This matters for the Dallas Fed’s thesis because the practical goal of these networks is to enable rapid, potentially continuous movement of deposits within the regulated banking perimeter. The more that implementation reduces settlement delays and operational friction, the more relevant the scenario of increased deposit mobility becomes.

Lessons from instant payments—comparisons and limits

To ground the discussion, Levy and Ramaswamy look to instant-payment systems as a partial analogy. They cite Brazil’s Pix, while noting that it is not identical to tokenized deposits. The report references a 2025 study from Brazil’s central bank that found heavier Pix usage was associated with banks holding more liquid assets and reducing credit intermediation.

That comparison doesn’t prove tokenized deposits will replicate Pix’s effects. But it supports the broader mechanism the Dallas Fed economists emphasize: when money moves faster and more easily, banks may rebalance toward liquidity and away from activities that require stable funding, at least relative to the counterfactual.

What to watch next

As tokenized-deposit networks advance from pilots to wider rollouts, the key unknown is how quickly depositors actually alter behavior when transfers become easier and settlement is effectively “always on.” Investors, borrowers, and regulators should watch whether banks respond primarily by shifting to more liquid asset buffers or by leaning more on term funding—both of which could influence credit conditions and the broader cost of capital.

An 80 million user fintech started distributing EURR in three European countries on August 26. Tether has been locked out of the same market since July 1. The stablecoin war is no longer about which token is biggest. It is about which one is allowed to exist.

Tether has spent a decade building the most widely used stablecoin in the world. As of August 2026, USDT commands 59% of the global stablecoin market, with $186 billion in circulation across every major blockchain and exchange. By any conventional measure, it is the most successful cryptocurrency product ever created.

On July 1, 2026, it ceased to exist in Europe.

That is not an exaggeration. When the European Union’s Markets in Crypto Assets regulation reached full enforcement, every MiCA licensed exchange in the European Economic Area was required to delist tokens that had not obtained e money authorization. Tether never applied. The company publicly objected to MiCA’s requirement that 60% of stablecoin reserves be held in EU bank deposits, arguing that it would reduce the yield on reserves and create unnecessary counterparty risk. The result was immediate: Binance, Coinbase, Kraken, and every other regulated exchange in Europe removed USDT trading pairs for EEA users.

Less than two months later, Revolut announced the rollout of EURR, a euro backed stablecoin, to customers in Denmark, Poland, and Portugal. The timing was not coincidental. Tether’s absence created a vacuum, and the largest fintech in Europe moved to fill it with a product designed from day one to comply with the regulation that Tether refused.

What EURR actually is

EURR is not Revolut’s creation. The token is issued by Bridge Building S.A., the Luxembourg based entity of Bridge, a stablecoin infrastructure company acquired by Stripe in 2024 for $1.1 billion. Bridge handles the token issuance, reserve management, and MiCA compliance. Revolut provides the distribution channel.

The arrangement mirrors how traditional finance has always worked: a regulated issuer creates the product, and a distribution partner brings it to customers. In this case, Bridge builds and manages the stablecoin, and Revolut integrates it into an app that 80 million people already use. The partnership gives EURR something no other euro stablecoin has: instant access to a massive, pre existing user base that already has verified identities, linked bank accounts, and familiarity with buying digital assets.

EURR launched initially on Ethereum with plans to expand to additional blockchain networks. It is designed to maintain a one to one peg with the euro, backed by reserves held and managed by Bridge in accordance with MiCA requirements. Revolut’s standard crypto trading limits apply, and fiat conversions carry no fees or spreads, a pricing decision that positions EURR as a gateway product meant to expand Revolut’s crypto ecosystem rather than generate direct stablecoin revenue.

The company stated that EURR is “only the first step” in a planned suite of stablecoins denominated in multiple currencies. That language suggests Revolut intends to build a multi currency stablecoin platform leveraging its banking licenses in the UK, EU, and other jurisdictions.

Why Tether walked away from Europe

Tether’s decision to skip MiCA authorization was not impulsive. It was a calculated judgment that the European market was not worth the structural changes MiCA would require.

The core objection centered on the 60% bank deposit requirement. Under MiCA, stablecoin issuers must hold at least 60% of their reserves in bank deposits at EU credit institutions. Tether’s current reserve composition is heavily weighted toward US Treasury bills, which yield approximately 4.5% annually. Shifting 60% of a $186 billion reserve base into bank deposits would reduce Tether’s yield income by billions of dollars per year while introducing counterparty risk to European banks that Tether views as less stable than US government debt.

The math made the decision straightforward. Tether reported $5.2 billion in net profit for the first half of 2026, almost entirely from interest on Treasury holdings. Complying with MiCA would have reduced that figure by an estimated $2 to $3 billion annually (the yield difference between Treasuries and EU bank deposits on $112 billion in reserves), while the European market represents less than 10% of USDT’s global usage.

Tether chose profits over geography. And for its global business, the decision has been vindicated: USDT’s total supply has continued growing since the MiCA deadline, as demand from Asia, Latin America, the Middle East, and Africa more than compensates for the European loss. Research released in July 2026 found that the combined market share of USDT and USDC “barely moved” after the delisting, because European USDT users migrated to decentralized exchanges instead of switching to USDC.

But “barely moved” in market share terms masks a real shift in how European users interact with stablecoins. Moving from regulated exchanges to DEXs introduces smart contract risk, higher fees, and reduced consumer protections. The MiCA deadline did not eliminate USDT demand in Europe. It pushed it underground.

The Circle monopoly problem

With Tether excluded, Circle’s USDC and EURC have become the only large cap stablecoins available on MiCA licensed exchanges. Of the world’s 50 largest stablecoins by market capitalization, only three satisfy MiCA requirements: USDC, EURC (both issued by Circle under French authorization), and USDG (issued under a Paxos linked structure). Everything else, from DAI to FDUSD to PayPal’s PYUSD, lacks the e money token authorization required for distribution in the EEA.

Circle obtained its Electronic Money Institution license from France’s Autorite de Controle Prudentiel et de Resolution on July 1, 2024, a full two years before the deadline, giving it time to build the compliance infrastructure that competitors scrambled to replicate. That head start has translated into a meaningful competitive advantage: USDC’s European transaction volume grew 340% in the first six weeks after the MiCA deadline as users migrated from delisted alternatives.

The near monopoly is uncomfortable for regulators who designed MiCA to increase competition in digital payments. A regulation intended to protect consumers and ensure financial stability has, in practice, concentrated the European stablecoin market in the hands of a single US issuer. Circle is incorporated in Delaware, regulated by French authorities, and now serves as the default stablecoin infrastructure for a continent of 450 million people.

EURR’s entry partially addresses this concentration, but with a critical difference: EURR is denominated in euros, not dollars. That makes it complementary to USDC rather than competitive. European users who need dollar denominated stablecoins for trading, remittances, or DeFi still have only one compliant option: Circle.

Revolut’s distribution advantage

The most significant aspect of the EURR rollout is not the token itself but the channel through which it reaches users. Revolut has over 50 million European customers and 16 million crypto users worldwide. By comparison, the largest euro stablecoin by market capitalization (Circle’s EURC) has approximately 240,000 unique holders on chain.

That gap is the distribution advantage. When EURR becomes available across Revolut’s full European user base, it will have a potential reach that dwarfs every existing stablecoin’s European distribution by an order of magnitude. Even a single digit conversion rate among Revolut’s European users would generate millions of stablecoin holders, creating a user base large enough to challenge EURC’s position within months of launch.

The initial rollout in Denmark, Poland, and Portugal covers approximately 2 million Revolut customers. Those three countries were chosen for their market characteristics: Denmark has high digital payment penetration, Poland has one of Europe’s most active crypto trading communities, and Portugal has historically favorable crypto tax policies (though a new capital gains tax took effect in 2025). The selection suggests Revolut is testing EURR with user bases that have high propensity to adopt crypto products.

The planned expansion across the EEA later in 2026 would bring EURR to users in Germany (Revolut’s second largest European market), France, Spain, and Italy. At that scale, EURR would not just be a stablecoin. It would be a feature within an app that tens of millions of Europeans already use for their daily banking.

The neobank stablecoin thesis

Revolut is not the only fintech eyeing stablecoins. Forbes reported in June 2026 that “every neobank will want its own stablecoin,” and the logic is straightforward: stablecoins allow fintechs to extend their product ecosystems into on chain finance without building blockchain infrastructure from scratch.

For Revolut specifically, EURR serves three strategic purposes. First, it keeps users inside the Revolut ecosystem for crypto activities that would otherwise require external wallets and exchanges. A Revolut user who wants euro denominated crypto exposure can now get it without leaving the app. Second, it generates data on how Revolut’s customers use on chain products, which informs the company’s broader crypto strategy. Third, it positions Revolut to capture yield from stablecoin reserves, a business model that Tether has proven can generate billions in annual profit.

The multi currency stablecoin plan is the most ambitious element. If Revolut launches stablecoins denominated in British pounds, Swiss francs, Swedish kronor, and other currencies it already supports in its banking app, it would become the first platform to offer a suite of fiat backed stablecoins covering multiple jurisdictions, all integrated into a single consumer application.

That model is fundamentally different from Circle’s (infrastructure focused, selling compliance and APIs to institutions) or Tether’s (yield maximizing, operating outside regulatory perimeters). Revolut’s model is consumer distribution first, with stablecoins as a product feature rather than a standalone business.

The DEX migration and what it costs European users

MiCA’s architects intended the regulation to bring stability and consumer protection to the stablecoin market. For USDT users specifically, it has done the opposite.

Since July 1, European traders who relied on USDT have not stopped using it. They have moved to decentralized exchanges where MiCA enforcement does not reach. On chain data shows that DEX volume from European IP ranges (as estimated by analytics firms tracking swap origins) increased 47% in the six weeks following the deadline, with Uniswap V3 and Curve Finance absorbing the majority of displaced volume.

The migration carries real costs. DEX users bear smart contract risk that centralized exchanges absorb. They pay gas fees on Ethereum (averaging $3 to $8 per swap in August 2026) that centralized exchanges internalize. They lose access to the consumer protections (dispute resolution, account recovery, fiat off ramps) that regulated exchanges provide. And they interact with liquidity pools that can be manipulated through MEV extraction, a problem that does not exist on centralized order books.

The irony is measurable. MiCA was designed to protect consumers from unregulated stablecoin risk. Its practical effect on USDT users has been to push them from regulated venues with consumer protections into unregulated venues without them. The regulation did not reduce USDT usage in Europe. It made USDT usage more dangerous.

Revolut’s EURR addresses this problem for users who are willing to switch from a dollar denominated stablecoin to a euro denominated one. For users who specifically need USDT, whether for dollar denominated trading pairs, cross border remittances to dollar economies, or participation in DeFi protocols that price assets in dollars, EURR is not a substitute. The regulatory squeeze has created a two tier European stablecoin market: compliant euro stablecoins on regulated exchanges, and non compliant dollar stablecoins on unregulated DEXs. Both markets are growing, and neither is solving the problem MiCA was designed to fix.

The competitive landscape beyond Circle and Revolut

The European stablecoin market is attracting entrants beyond the current leaders. As of Q1 2026, approximately 35 regulated e money tokens have been issued by 21 entities under MiCA across France, the Netherlands, Finland, Malta, Luxembourg, and Germany. Most are small (under $50 million in circulation), but the regulatory infrastructure is in place for rapid scaling.

SocieteGenerale’s FORGE platform issued EUR CoinVertible (EURCV), a institutional grade euro stablecoin targeting corporate treasury and trade finance applications. Deutsche Bank has announced plans for a euro stablecoin through its digital asset subsidiary. Banking Circle, a payments bank headquartered in Luxembourg, has launched EURI with direct settlement into the TARGET2 payment system.

None of these competitors have Revolut’s consumer distribution. EURCV is designed for institutional use cases that individual users will never touch. EURI is a payments infrastructure product, not a retail token. The European stablecoin market is developing along two parallel tracks: institutional grade tokens for wholesale finance, and consumer grade tokens for retail adoption. Revolut’s EURR is positioned on the consumer track where distribution matters more than institutional relationships.

The wildcard is Stripe itself. Bridge, the company issuing EURR, is a Stripe subsidiary. Stripe processes payments for millions of internet businesses globally. If Stripe integrates EURR (or future Bridge stablecoins) directly into its merchant payment flows, the distribution channel extends far beyond Revolut’s app into the checkout pages of every Stripe merchant in Europe. That integration has not been announced, but the corporate structure makes it possible, and the potential scale would dwarf anything the stablecoin market has seen.

The GENIUS Act connection

The European stablecoin shakeout is happening simultaneously with stablecoin regulation evolving in the United States. The GENIUS Act, signed into law in 2025, set a one year deadline for federal agencies to write implementing rules for stablecoin issuance. That deadline was missed by four months, with the OCC now targeting November 2026 for a final rule.

The GENIUS Act’s requirements bear a family resemblance to MiCA’s: on demand redemption at par, one to one reserve backing, and regular attestation of reserves. But the GENIUS Act does not include MiCA’s 60% bank deposit requirement, which means Tether could potentially comply with US rules while remaining non compliant in Europe. If Tether obtains a US federal or state license under the GENIUS Act framework, it would create a bifurcated regulatory landscape in which USDT is legal in the United States but illegal in the European Union.

That bifurcation would have consequences for global crypto markets. Exchanges operating in both jurisdictions would need to maintain separate USDT liquidity pools, with European users unable to access the same trading pairs as American users. The fragmentation would increase costs, reduce liquidity, and create arbitrage opportunities that sophisticated traders would exploit at the expense of retail participants.

Revolut’s position in this landscape is unusually strong. With banking licenses in the UK, EU licensing under MiCA, and a growing US presence, the company is one of the few entities that could potentially distribute stablecoins across all three major regulatory jurisdictions. Whether it chooses to do so depends on how quickly it can build out its multi currency stablecoin suite and navigate the licensing requirements in each market.

The regulatory fragmentation also creates an opening for geopolitical competition. If the US finalizes stablecoin rules before Europe fully enforces MiCA’s exchange provisions, American stablecoin issuers will have a regulatory moat that European competitors cannot easily cross. Conversely, if European issuers like Bridge scale faster under MiCA’s clearer framework, the EU could become the first jurisdiction where regulated stablecoins achieve mass consumer adoption. The race is no longer about which stablecoin is biggest. It is about which regulatory framework produces the most usable products for the most people, and Revolut’s 50 million European users are the largest prize on the board.

What to watch

EURR daily transaction volume in the first 30 days will indicate whether Revolut users treat it as a holding asset, a trading pair, or a payments tool. The use case determines the stablecoin’s velocity and, by extension, its economic impact.

Revolut’s EEA expansion timeline beyond the initial three countries. If the full rollout reaches Germany and France by Q4 2026, the distribution advantage becomes structural. If regulatory delays push it to 2027, Circle’s head start consolidates.

Tether’s GENIUS Act compliance filing would signal that Tether is pursuing a US first regulatory strategy, permanently conceding Europe. Absence of a filing by November 2026 would suggest Tether intends to remain entirely outside regulated markets.

EURR supply crossing $500 million would place it among the top 15 stablecoins globally and confirm that consumer fintech distribution can compete with crypto native issuance channels.

Additional Revolut stablecoin denominations (GBP, CHF) launching in 2026 would validate the multi currency thesis and position Revolut as the first global stablecoin supermarket.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrency investments carry significant risk. Always conduct your own research before making investment decisions. Published August 27, 2026.

Thirty-nine U.S. state bankers associations have formed BankChain Alliance to develop a bank-owned blockchain network for tokenized deposits, stablecoins, smart payments and automated settlement, with a launch targeted for 2027.

BankChain Alliance said in its Aug. 25 announcement that the proposed network will be designed, governed and owned by the banking industry, while banks across the United States will be invited to become owners as the group works through its technology selection process.

Still in its development stage, BankChain is not operating a payments network yet. The alliance has completed the first phase of its request for proposals and is evaluating technology providers while planning an infrastructure that can connect with other financial networks.

Kathy Kraninger, chair of BankChain Alliance and president and CEO of the Florida Bankers Association, said the project is intended to give banks of different sizes a role in building the infrastructure they would use.

“This is about banks of all sizes building their own future,” Kraninger said, describing the planned system as an industry-led network that would serve institutions across rural, regional and urban markets.

BankChain Alliance brings 3,283 banks under its association network

The 39 state associations involved in BankChain collectively represent 3,283 banks holding $21.8 trillion in assets, based on Federal Deposit Insurance Corp. call-report data as of March 31, according to the alliance.

Participation, however, currently sits at the association level. BankChain states on its website that individual banks represented by the participating associations have not automatically committed to or joined the planned blockchain network unless separately indicated.

Its member associations cover Alabama, Arkansas, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Indiana, Iowa, Kansas, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nebraska, Nevada, New Hampshire, New Jersey, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, Wisconsin and Wyoming.

Under the proposed structure, banks would be able to use common blockchain infrastructure for services including tokenized deposits, stablecoins, programmable payments and automated settlement. BankChain also plans to make the network interoperable with other systems, although it has not disclosed the underlying blockchain architecture or technical framework.

A tokenized deposit represents commercial bank money on blockchain infrastructure and remains a liability of the issuing bank. The structure differs from stablecoins issued by nonbank companies, which can use separate reserve and redemption arrangements.

BankChain plans to accommodate both tokenized deposits and stablecoins alongside smart payment functions, giving participating institutions several types of blockchain-based payment instruments on the same planned network.

Banks would own the BankChain infrastructure

Ownership forms a central part of BankChain’s proposed structure, although the alliance has not disclosed how much participating banks would be required to invest.

Public materials do not provide figures for committed capital, association contributions, ownership percentages or pricing. American Banker separately reported that BankChain wants to obtain an ownership interest in the technology company ultimately chosen to support the network.

The alliance has already completed the first stage of its request-for-proposals process, Kraninger told the publication.

During that process, regulatory compliance received more weight than any other factor, according to Corey LeBlanc, co-founder and chief technology officer of Locality Bank.

Governance is also being built around participation from state banking organizations. Howard Headlee, president and CEO of the Utah Bankers Association, told American Banker that BankChain is intended to provide member institutions with “equal access to a network they own, where their voice is heard.”

Kraninger chairs a board that also includes executives from state banking groups in Ohio, Nebraska, Texas, North Carolina, Missouri, Utah, New Hampshire and Massachusetts. TekFactor founder Kim Askwith is another member of the board.

Individual banks have yet to be named as owners of the planned network, leaving BankChain to move from association participation toward direct commitments from financial institutions before its targeted 2027 launch.

BankChain joins another bank-led tokenized deposit project

BankChain is entering a U.S. banking sector where major institutions are separately preparing blockchain infrastructure for commercial bank deposits.

Crypto.news previously reported that JPMorgan Chase, Citigroup, Bank of America and Wells Fargo are working through The Clearing House on a shared tokenized deposit network targeted for the first half of 2027.

The Clearing House project is expected to allow corporate customers to transfer tokenized commercial bank money around the clock while connecting blockchain transactions with established banking infrastructure.

Owned by 25 of the largest U.S. financial institutions, The Clearing House already operates payment networks including RTP and CHIPS and says its systems clear and settle more than $2 trillion every day.

Its tokenized deposit project includes support from more than a dozen institutions, including BNY, HSBC, PNC, Santander, TD Bank, Truist and U.S. Bank. Services under consideration include programmable treasury functions, automated payments, liquidity management and cross-border transfers.

No operational launch date beyond the first-half 2027 target has been disclosed, and a technology provider had not been announced when the initiative became public.

BankChain has outlined a different product mix by including stablecoins alongside tokenized deposits, smart payments and automated settlement. Its ownership model is also being organized through state bankers associations and eventual direct participation by banks nationwide.

Wells Fargo, one of the institutions involved with The Clearing House, is also preparing its own tokenized deposit service for corporate and commercial clients.

The bank said in August that an initial rollout planned for this fall would support U.S. dollar-to-British pound transactions for selected customers, with the platform designed to handle transfers and settlements outside conventional banking hours.

Additional clients, currencies and countries are expected to be introduced throughout 2027 as Wells Fargo expands the service.

Banks are moving tokenized payments toward deployment

Blockchain-based bank money is also being tested through infrastructure outside the two U.S. consortium projects.

SWIFT moved its blockchain ledger into initial deployment in July, with 17 global banks preparing to test tokenized deposit payments across the network.

HSBC, Citi, BNP Paribas, UBS, ANZ, DBS and Standard Chartered were among the institutions named in the initial rollout after SWIFT spent nine months developing the system.

The ledger is designed to support international payments during weekends and overnight periods while participating banks retain existing compliance, risk-management and control requirements. Final settlement continues through established banking rails during the initial deployment.

Another structure has been tested by Custodia Bank and Vantage Bank, which have developed a token that can function as a bank deposit within their Hazel network and operate as a stablecoin when transferred outside it.

The banks disclosed the dual-purpose token model in June after testing the Ethereum-based system from March.

Their structure allows participating institutions to retain their customer deposits and control their own wallets while accessing tokenized deposit and payment-stablecoin functions.

Custodia and Vantage have been evaluating the platform with banks ahead of a planned fourth-quarter 2026 rollout, with the system intended for institutions including community banks and credit unions.

BankChain has not named the companies competing to become its technology partner or disclosed when testing with individual banks will begin. Its next steps remain the selection of the network’s technology provider and recruitment of banks as owners before the targeted 2027 launch.