CoinDesk
Canada's six largest banks are jointly exploring a Canadian-dollar tokenized deposit system to move money faster between financial institutions, with a longer-term goal of connecting to other digital asset initiatives. Bank of Montreal, Canadian Imperial Bank of Commerce, National Bank of Canada, Royal Bank of Canada, Scotiabank and TD Bank Group announced the joint venture on Tuesday.
The first phase will test transfers of tokenized deposits across participating banks, and the banks said more institutions could join later. Tokenized deposits are digital representations of money already held at a bank, distinct from stablecoins issued by crypto firms. The model would let lenders test programmable, around-the-clock payments while keeping customer funds under regulatory oversight.
Why it matters
This is the dominant group in Canadian banking moving together rather than leaving Canadian-dollar blockchain activity to stablecoin issuers alone. The initiative adds a payments use case to Canada's broader tokenization work: in March, the Bank of Canada, RBC and TD completed Project Samara, issuing and settling a 100 million Canadian dollar (roughly $71 million) bond on a distributed ledger.
Canada's move mirrors a global race. US regional lenders are building a shared tokenized-deposit network, JPMorgan, Citi and Wells Fargo run institutional offerings of their own, and Swift has begun testing tokenized deposits for 24/7 cross-border payments with banks across six continents. Shopify and National Bank of Canada also backed a regulated digital Canadian dollar in May.
Market impact
The project does not yet commit the banks to issuing a tokenized deposit, so near-term market impact is limited to signaling. But a common model backed by all six lenders sets the baseline for how Canadian-dollar digital money is built, and the stated path toward broader digital asset connections makes it one to watch for institutional blockchain flows in Canada.
Frequently asked questions
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Which Canadian banks are involved in the tokenized deposit initiative?
Bank of Montreal, Canadian Imperial Bank of Commerce, National Bank of Canada, Royal Bank of Canada, Scotiabank and TD Bank Group. The joint statement said more banks could join the project later.
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How do tokenized deposits differ from stablecoins?
Tokenized deposits are digital representations of money already held at a bank, while stablecoins are separate tokens issued by crypto companies. Tokenized deposits keep customer funds within the regulated banking system.
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What will the first phase of the project test?
The first phase focuses on moving tokenized deposits efficiently across the participating Canadian financial institutions, with a longer-term goal of connecting to other emerging digital asset initiatives.
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How does this relate to Canada's Project Samara?
In March, the Bank of Canada, RBC and TD completed Project Samara, which issued, traded and settled a 100 million Canadian dollar (roughly $71 million) bond on a distributed ledger using tokenized wholesale Canadian dollars.
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Have the banks committed to issuing a tokenized deposit?
Not yet. The project does not commit the lenders to issuing one, but it brings most of Canada's largest banks together to explore a common model rather than leaving blockchain-based Canadian dollars to stablecoin issuers alone.
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