BNY Mellon launches tokenized deposits

According to Bloomberg, Bank of New York Mellon (BNY) has launched a tokenized deposit service that allows clients to transfer funds through a blockchain network.

The tokenized deposit is an on-chain representation of the deposits held by BNY clients in their bank accounts, which can be used for collateral and margin trading, and enables 24/7 operations to accelerate payment speeds. Currently, institutions participating in this service include Intercontinental Exchange (ICE), Citadel Securities, DRW Holdings, Ripple Prime, Baillie Gifford, and Circle. BNY currently manages or administers assets totaling $57.8 trillion, making it the third major global bank to delve into the digital asset space, following JPMorgan and HSBC.

ICE plans to support tokenized deposits in its clearinghouse to align with its preparations for 24/7 trading settlements. Additionally, the service supports programmable trading, allowing fund transfers to be automatically triggered when predefined conditions (such as loan repayment obligations) are met.