JPMorgan (JPM) and Singapore’s DBS Bank (D05) are developing a framework for institutional clients to move tokenized deposits across different blockchain networks.
The system would connect DBS token services to JPMorgan’s Kinexys Digital Payments project, enabling interbank and cross-chain settlements, the banks said in an emailed announcement Tuesday.
Both banks already allow instant payments within their own blockchain systems. This new effort would connect these closed networks, allowing customers to send value between institutions without relying on traditional payment rails.
“Working with DBS on this initiative is a clear example of how financial institutions can collaborate to increase the benefits of tokenized deposits for institutional clients while protecting the uniqueness of money and ensuring interoperability across markets,” said Naveen Mallela, Global Co-Head of Kinexys at JPMorgan.
JPMorgan, which took its first steps into blockchain finance several years ago, recently took the next step in decentralized finance (DeFi), issuing a USD deposit token on Coinbase’s Base blockchain, a public Layer 2 ledger.
The new tie-up would allow a JPMorgan client to use its deposit tokens on the Base blockchain to pay a DBS client, for example, who could then trade or hold those tokens on the DBS platform.
The move reflects growing efforts by major banks to make digital deposits work seamlessly across systems and jurisdictions. According to the Bank for International Settlements (BIS), around a third of banks worldwide have introduced or are exploring token deposit projects.
