JPMorgan Chase, Bank of America, and Citibank Plan Tokenized Deposit Network With The Clearing House

Major U.S. banks including JPMorgan Chase, Bank of America, and Citibank are preparing to move deposits onto the blockchain through The Clearing House by the first half of 2027, aiming for 24/7 settlement and on-chain transfers.

“America’s largest banks are building a new digital currency network to stop a massive deposit drain America’s biggest banks are launching tokenized deposits to compete with stablecoins, opening a new front in the race to become the dominant form of cash on blockchain networks”

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The plan is framed as a direct response to stablecoins, with the KuCoin report saying it targets the “rapidly growing stablecoin market” and noting that USDC and USDT are “widely used for cryptocurrency trading, cross-border payments.”

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Jefferies estimates deposit outflows of 3% to 5%, and in a March report Jefferies also estimated stablecoins could cause banks to lose 3% to 5% of their core deposits over the next five years and reduce average bank profitability by approximately 3%.

Reid Noch of TD Securities said stablecoins, tokenized deposits, and tokenized money market funds are competing for dominance as “on-chain cash instruments,” while the initiative’s supporters argue tokenized deposits primarily target payment efficiency.

The Clearing House is described as leading the initiative, with corporate payments and treasury management expected to be first use cases if the network launches as planned.

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In parallel, CoinDesk frames the broader shift as “The battle for digital dollars is moving onchain,” describing how JPMorgan Chase, Bank of America, Citigroup and other lenders plan to launch a shared tokenized deposit network through The Clearing House by the first half of 2027.

CoinDesk quotes Reid Noch saying, “Anyone who has ever wired money, especially internationally, knows the process can be expensive and often takes one to two business days to complete,” and it says tokenized deposits could allow near-instant transfers around the clock.

Noelle Acheson is quoted by CoinDesk noting banks have spent years experimenting with private blockchain systems that move money internally while maintaining strict control over users and transactions.

The Defiant says four of the largest U.S. commercial banks—JPMorgan Chase, Citigroup, Bank of America, and Wells Fargo—are building a shared tokenized deposit network through The Clearing House targeting a first-half 2027 launch.

“Global banking is starting to clearly glimpse the benefits that blockchain-based settlement networks can offer”

CriptoTendencia

It expands the participant roster beyond the four lead banks, naming BNY, BMO, Citizens Financial, Fifth Third, HSBC, Huntington, KeyBank, PNC, Regions, Santander, TD Bank, Truist, and U.S. Bank, while stating that a blockchain vendor has not yet been selected.

David Watson, President and CEO of The Clearing House, called the initiative “a big move for the banks” and said the industry faces a “radically different” future built around on-chain payments.

The Defiant also quotes JPMorgan’s Max Neukirchen saying a “regulated market-infrastructure solution for clearing and settling tokenized deposits” is essential to keeping the payments ecosystem “stable, resilient, and effective.”

PYMNTS adds that Bank of America’s Mark Monaco acknowledged clients aren’t necessarily “beating down the door” for tokenized deposits, but said “With any sort of new adoption, it takes time,” while describing the network as operated by The Clearing House and planned for the first half of 2027.