Canada's Big Six Banks Develop Tokenized Deposits for Faster Payments

Canada's six biggest banks have launched a collaborative effort to develop a new digital money system. RBC, TD, BMO, CIBC, Scotiabank, and National Bank of Canada are working together on tokenized deposits, which represent regular bank deposits digitally on a shared system.

The system will maintain existing safeguards around financial stability and regulation while allowing for faster and more efficient payments that can be programmed. This is separate from the Bank of Canada's work on a possible digital Canadian dollar, with 85% of respondents to a public consultation saying they would not use a hypothetical digital Canadian dollar.

The project is still in its exploration stage, but if it moves forward, it could eventually sit behind everyday banking and payments. The banks haven't announced a launch date or detailed how customers will interact with tokenized deposits.