BNY Mellon Explores Tokenized Deposits, Enabling Clients to Make On-Chain Payments

BNY Mellon, one of the world’s largest custodial banks managing $55.8 trillion in assets, is exploring tokenized deposits to allow clients to make payments via blockchain networks, according to a Bloomberg report.

The initiative is part of BNY Mellon's efforts to modernize payment infrastructure, focusing on real-time, instant, and cross-border payments. Tokenized deposits act as digital equivalents of traditional bank deposits, representing a customer's claim to funds held at the bank.

Carl Slabicki, Executive Platform Owner for Treasury Services at BNY Mellon, explained that tokenized deposits could help banks overcome legacy technology barriers, enabling smoother fund movement within banking ecosystems and, eventually, across the broader financial market as industry-wide tokenization standards develop.

BNY Mellon’s treasury services division processes approximately $2.5 trillion in daily payments, highlighting the scale and potential impact of integrating blockchain-based payment solutions.

In July, BNY Mellon partnered with Goldman Sachs to allow clients to invest in money market funds with ownership records stored on Goldman’s blockchain solution. This move aligns with the growing trend of digital banking innovation and financial institutions adopting tokenization to enhance efficiency and security.

Other global banks are following similar paths. JPMorgan recently tested JPMD, a token representing dollar deposits on the Layer 2 network Base, while HSBC launched a tokenized deposit service for secure cross-border transfers. Additionally, SWIFT announced its plans to integrate a blockchain-based shared ledger to support 24/7 international payments, partnering with Consensys and over 30 financial institutions worldwide.

As financial institutions increasingly embrace digital assets, blockchain payments, and tokenization, BNY Mellon’s initiative reflects a growing trend toward faster, more secure, and cost-efficient payment solutions for corporate clients worldwide.