Canadian Banks Unite on Shared Deposit Token Platform

Canada's six largest banks have joined forces to create a shared platform for institutional deposit tokens. According to an announcement by TD Bank Group on the 22nd, the participating institutions include Bank of Montreal (BMO), Canadian Imperial Bank of Commerce (CIBC), National Bank of Canada, Royal Bank of Canada (RBC), Scotiabank, and TD Bank Group.

The project's first phase will focus on transferring deposit tokens between participating banks. Deposit tokens are digital representations of actual deposits held at banks, not separate stablecoins issued by cryptocurrency firms. The joint statement highlights the potential for faster, more efficient, and programmable payments to Canadian customers while maintaining financial stability and regulatory oversight.

The initiative is part of a global trend among banks to move deposits onto blockchain infrastructure. In the United States, regional banks are building a shared tokenized deposit network, while JPMorgan, Citi, and Wells Fargo have each been pursuing institutional-facing services. Swift has also begun testing tokenized deposits for 24-hour cross-border payments with banks across six continents.

This project adds another payments use case to Canada's tokenized financial market efforts. In March, the Bank of Canada, RBC, and TD completed 'Project Samara,' a pilot that used tokenized wholesale Canadian dollars to issue, trade, and settle C$100 million (approximately $71 million) in bonds on a distributed ledger.

Canada is also cultivating its domestic stablecoin market. In May, Shopify and National Bank of Canada agreed to support a regulated, 24/7 digital Canadian dollar.