UK Banks Move Real Deposits Between Institutions Using Blockchain
UK banks have made significant strides in using blockchain technology to move real deposits between institutions. A pilot project, known as the Great British Tokenised Deposit initiative (GBTD), has successfully processed two remortgages and one marketplace payment using ordinary customer deposits connected through a shared blockchain infrastructure.
The GBTD platform was developed by Quant to connect participating banks, including Barclays, HSBC UK, Lloyds Banking Group, Monzo, Nationwide, NatWest, and Santander. The project has shown that tokenised deposits can be used for programmable payments while maintaining the safety and trust associated with commercial-bank money.
The two remortgages were completed using live sterling funds, and one marketplace payment was made, but no physical goods changed hands. The transactions demonstrated that a bank deposit can carry payment conditions similar to an escrow arrangement, but questions remain about how a future service would establish that an item had been delivered in the agreed condition.
The next phase of the project will focus on connecting tokenised deposits with digital assets, including issuing digital debt instruments that can be traded and settled through the same infrastructure. The banks plan to test three digital bonds in 2027 as part of this effort.