Tokenized Deposits and Bank Tokens

A tokenized deposit is a bank deposit recorded as a digital token on a ledger that the bank, or a group of banks, operates. The customer still holds a claim on the bank, with the same legal nature as an ordinary deposit, and the token is a new way of recording and moving that claim. This separates it from a stablecoin, which is a claim on a non-bank issuer and its reserve. A bank-issued token can sit on a permissioned network where participants are known and vetted, or in some designs on a public chain with controls on who may hold it. In both cases the bank, not the code, remains the party that owes the money.

The appeal of the idea comes from what a shared ledger could add to bank money: programmable payment conditions, settlement of linked transfers in one step, and round-the-clock operation. Open points remain. Tokens from different banks must be exchangeable at par, which needs common standards or settlement in central bank money. Deposit protection rules were written for accounts, so how they apply to tokens depends on the legal design. Public research from the BIS and the IMF discusses a unified ledger in which central bank money, bank deposits and tokenized assets interact. Most of that work is still at the stage of pilots and proposals, so product claims deserve a careful look at the underlying terms.