01The deposit franchise is being repriced in real time
Start with the number most bank strategy decks politely avoid: in the five years to 2025, roughly $3 trillion in deposits left banks for fintechs.1 That migration happened before programmable money worked at scale. It happened on the strength of better interfaces alone.
Now the money itself is getting better. The GENIUS Act, signed July 2025, gave US payment stablecoins a federal framework covering reserves, redemption rights, and regulated custody.2 A licensed stablecoin is now a legal, dollar-denominated instrument your corporate treasurer can hold instead of your deposit. Standard Chartered projects $4 trillion in tokenized assets by the end of 2028, roughly half of it stablecoins.3
Walk through what happens when a client makes that move. Every dollar shifted from a deposit into a third-party stablecoin leaves your balance sheet. It stops funding your loan book. The float income goes to the issuer. The client relationship goes with it: payments data, treasury services, the daily touchpoint. For a bank, stablecoin adoption lands directly on funding cost, and it compounds quarter after quarter.
Meanwhile, the operational gap that pushes clients on-chain in the first place is built into the rails themselves. Traditional settlement closes on Friday evening and reopens Monday morning, roughly 60 hours every week in which collateral cannot move, positions cannot be trued up, and the risk of being unable to act cannot be priced away. Your clients’ markets no longer close. Their money still does.
“Most banks I speak to are having a tough time debating stablecoins vs. tokenized deposits.”Digital-asset banking commentator, X, May 20264
That debate is the right one to have, and it has a defensible answer. Most working groups stall on it because they treat it as a technology selection. The choice in front of you is a balance-sheet choice that happens to involve technology. This guide gives you the frame.
02What each instrument actually is
A stablecoin is someone else’s liability
A payment stablecoin is a bearer-style token issued by a third party. Under GENIUS, that issuer is licensed and holds reserves in cash and short-dated treasuries with a regulated custodian. When your client holds USDt or a bank-consortium coin, they hold a claim on the issuer, never on you. It redeems at par, it moves 24/7, and anyone with a wallet can receive it. Under the US framework it pays no interest, and it sits entirely outside your deposit base.
A tokenized deposit is your liability, made programmable
A tokenized deposit is the same commercial bank deposit your client already holds, with the same balance-sheet treatment, the same deposit-insurance eligibility, and the same ability to pay interest, represented as a token that settles in seconds instead of days. The client keeps a claim on your bank. You keep the funding, the float, and the relationship. What changes is the rail: the deposit gains the mobility that was previously the stablecoin’s whole advantage.5
One sentence to take into the steering committee: a stablecoin disintermediates the deposit; a tokenized deposit upgrades it. Everything else in this paper is detail on that sentence.
03Eight dimensions that decide the question
| DIMENSION | TOKENIZED DEPOSIT | STABLECOIN |
|---|---|---|
| Whose liability | Yours. Stays on your balance sheet and funds your lending | The issuer’s. Leaves your balance sheet entirely |
| Deposit insurance | Eligible, as an ordinary deposit | Not insured; backed by issuer reserves |
| Interest | You can pay it, which makes it a retention tool | Prohibited for US payment stablecoins under GENIUS |
| Credit capacity | Preserved. Deposits keep funding the loan book | Lost. Each dollar out is funding gone |
| Regulatory home | Existing banking regulation; pilots running under HKMA, MAS, UK frameworks | New regimes: GENIUS (US), MiCA (EU), HKMA licensing (HK) |
| Reach | Your customers and counterparty banks | Anyone with a wallet: maximum openness, minimum control |
| Settlement | Seconds to minutes, 24/7, programmable | Seconds to minutes, 24/7, programmable |
| Client privacy | Depends entirely on the rail it is issued on | Public by default on most chains, where flows are visible to competitors |
Stablecoins keep a real category of their own. For reaching counterparties who will never open an account with you, the stablecoin is the better instrument. That is why HSBC and Anchorpoint took Hong Kong’s first issuer licenses in April 2026 while building deposit tokens in parallel.6 The institutions moving fastest run both and give each instrument a different job.
Who has already decided
- JPMorgan: JPMD deposit token live since November 2025; tokenized money-market funds followed within months, and Jamie Dimon publicly told the bank to move faster.7
- Standard Chartered × Ant International: 24/7 tokenized deposits in production across HKD, CNH, SGD and USD since December 2025.8
- HSBC: tokenized deposit service live for US corporates with UAE in flight, alongside its stablecoin license.6
- HKMA Project Ensemble: the first real-value tokenized-deposit settlement on Hong Kong’s RTGS, with HSBC, Standard Chartered, BOC HK, BlackRock, Franklin Templeton and HKEX participating.9
The window for this to be a differentiator is open now and closing on a regulatory clock. MiCA’s transition ends July 1 2026, Hong Kong’s pilots convert to production through 2026, and the OCC’s GENIUS implementing rules are in active rulemaking.2,9 Eighteen months from now, a tokenized deposit is table stakes. Today it is an announcement your competitors read.
04The decision framework
Tokenized deposit When the client should stay yours
Corporate treasury, intercompany flows, supply-chain payments, collateral movement between your own clients and counterparty banks. Anywhere the holder already banks with you, the deposit token keeps funding, float, interest, and data in-house while matching the stablecoin on speed. This is the defensive core, and the first project for most banks.
Stablecoin When reach beats retention
Paying or getting paid by parties who will never hold an account with you: global suppliers, marketplaces, crypto-native counterparties. Issuing or distributing a stablecoin trades balance-sheet benefit for open-network reach. Treat it as a product decision rather than an infrastructure one, and note that the reserves themselves must sit with regulated custodians.2
Both What the leaders are actually doing
Deposit token for the client base, stablecoin (issued or partnered) for the open network, money-market funds tokenized as the low-risk first asset. One issuance platform sits underneath all three, which turns the instrument debate into an infrastructure decision.
05The question under the question: whose rails?
Every path above ends at the same fork. A consortium chain means joining a club you don’t control, with membership fees and a roadmap set by committee. A general-purpose public chain means your treasury flows are visible to anyone, including competitors reverse-engineering your client list from on-chain data, on a network whose validators, token politics, and fee markets you have to explain to a risk committee.
There is a third option, and it is the one the first billion-dollar regulated issuances actually chose: a settlement layer anchored to Bitcoin, the one blockchain your risk committee has already spent a decade learning to reason about, with the compliance and confidentiality features banks require built in at the protocol level.
How this works on Blockstream’s rails
Blockstream AMP issues and manages assets on the Liquid Network, a Bitcoin layer-2 governed by a federation of 85+ named industry institutions. The network carries approximately $5 billion in assets, with 16,800+ BTC bridged since 2018, a figure you can verify on-chain yourself.10
- Compliance lives in the token. Investor whitelists and transfer restrictions are enforced by the protocol itself. Your tokenized deposit cannot move to a wallet that isn’t yours to serve, even on secondary markets, and the AML check happens at the asset level, before a transfer can settle.
- Confidential to the market, transparent to your regulator. Liquid’s Confidential Transactions hide amounts and asset types from outside observers, so no competitor reads your flows, while audit keys give your regulator selective, provable disclosure.
- Settlement that matches your clients’ hours. Blocks every ~60 seconds, deterministic finality, every day of the week. The 60-hour weekend gap does not exist here.
- No consortium, no token politics. Open-source infrastructure, federated governance by named institutions, and no speculative native token sitting between your deposit and its settlement.
- Proven at issuance scale. Mifiel has cleared more than $2B in tokenized promissory-note lending on Liquid via AMP; STOKR runs $1.3B in tokenized assets, including the first securities tracking MicroStrategy and Metaplanet.11 Regulated instruments already run in production on these rails.
- Custody that survives diligence. Blockstream Enterprise keeps keys with your institution: multisig and HSM-backed, segregated accounts, on-chain proof of reserves, no rehypothecation. The instrument and its custody come from one stack, verifiable end to end.
Two conclusions follow. The instrument debate resolves quickly once each instrument is given its job, and the leaders are already running both. The infrastructure choice underneath deserves more attention than it usually gets, because it determines who can see your flows, what your compliance perimeter looks like, and whether your pilot survives contact with a risk committee.
Banks that move first get eighteen months of differentiation. Banks that move later inherit whatever rails the first movers standardized. Either way, the deposit franchise is being repriced. The open question is whether your bank holds the repriced asset or watches it leave.
A 45-minute working session with our issuance team covering your use case, the regulatory posture in your jurisdiction, and what a tokenized-deposit or money-market-fund pilot on Liquid looks like in practice: timeline, integration surface, proof points.
1. Deposit-migration estimate widely cited in fintech market commentary, 2025 (directional figure). 2. GENIUS Act, signed Jul 18 2025; OCC implementing rules proposed in Bulletin 2026-3 (Feb 2026). Reserves must sit with federally or state-regulated custodians. 3. Standard Chartered research note, May 2026 (via The Block). 4. Public post, X, May 2026; representative of recurring sentiment in our 290-tweet institutional corpus. 5. See also HSBC, JPMorgan, and HKMA program materials on deposit-token design. 6. CoinDesk / Bloomberg, Apr 10 2026; PYMNTS on the US service. 7. J.P. Morgan newsroom, Nov 2025; J.P. Morgan AM, Dec 2025 & May 2026; CoinDesk, Apr 2026. 8. Ledger Insights, Dec 2025. 9. HKMA press release and annexes, Nov 13 2025. 10. liquid.net and Liquid Federation quarterly updates (Q4 2025, Q1 2026); peg ledger via the Blockstream Explorer API, Jun 2026. 11. Liquid Network case study (Mifiel); stokr.io; Blockstream Liquid Q1 2026 update.
© Blockstream Corporation · June 2026 · This guide is educational material, not legal or regulatory advice. Figures are dated as cited and refreshed quarterly.