HSBC and Standard Chartered have shifted tokenized deposits to institutional adoption following completing the first bank-to-bank transaction using SWIFT’s blockchain.
Mark Willies, HSBC’s Global Head of Digital Assets, noted an increasing institutional demand for prompt liquidity management and the importance of interoperable tokenized deposits, helping institutions enhance treasury operations and real-time liquidity management in the market.
Interoperability is still a key barrier to broader tokenized-deposit adoption. In the HSBC-Standard Chartered transaction, the payment was reported on both banks’ tokenized-deposit networks, while SWIFT’s blockchain network managed coordination and record-keeping.
Lewis Sun, Global Head of Digital Assets and Emerging Technologies at Standard Chartered, highlighted that the transaction demonstrates how bank-issued digital money can operate against institutions while retaining existing regulatory frameworks.
24/7 Settlement
Banks are exploring tokenized deposits across institutions and regions, with a focus on interoperability and 24/7 settlement. HSBC has increased its Tokenized Deposit Service in the markets, delivering authorized corporate and institutional clients for both domestic and cross-border transfers.
Furthermore, banks are also developing networks associated with tokenized deposits between institutions. The Clearing House announces plans to promote a tokenized deposit system in the first half of 2027, associating traditional payment with digital asset network for 24/7 settlement.
Tokenized Deposit Structure
Tokenized deposits are different from stablecoins. Stablecoins are issued privately and supported by liquid reserves, while tokenized deposits are digital deposits issued by regulated institutions and show direct claims on the banks. It can also be transformed back into cash and credited to bank accounts.
For corporate treasuries, tokenized deposits integrate accelerate settlement, automated payments, digital asset integration, and protected transactions while maintaining its existing banking partnerships and regulatory compliance.
Tokenized Deposit Advanceme
HSBC-Standard Chartered transaction is the newest tokenized-deposit advancement. Canton Network reported that tokenized deposits run on its system, with HSBC, Lloyds Bank, and JPMorgan Chase involved in testing.
The Clearing House reported initiatives to allow on-chain clearing and settlement of tokenized deposits within the existing banking system. Cari Network also reported an upcoming test for real-time settlement, liquidity management, and digital money transfers, supported by several US regional banks.
The key concern is whether these projects can offer prompt settlement, lower settlement costs, and real-time cash management. The next barriers are measuring from pilot test to production systems that deliver interoperability while complying with regulatory requirements across the legal framework.
