BNY Mellon Explores Tokenized Deposits to Modernize $2.5 Trillion Payment Network

World’s Largest Custodian Bank Moves Toward Blockchain-Powered Payments

BNY Mellon, the world’s largest custodian bank, is exploring the use of tokenized deposits to migrate a portion of its $2.5 trillion daily payment flow onto blockchain infrastructure, according to recent reports. The initiative aims to enhance real-time payment capabilities, improve cross-border settlement efficiency, and reduce dependency on legacy financial systems.

Carl Slabicki, executive platform owner for Treasury Services at BNY, said the project is designed to modernize how deposits and payments move across institutions. “Tokenized deposits can help banks overcome legacy technology constraints, making it easier to move deposits and payments across their own ecosystems – and eventually, across the broader market as standards mature,” Slabicki noted.

Unlike stablecoins, which are typically backed by securities or third-party reserves, tokenized deposits represent direct claims on commercial bank balances and are fully backed by bank money. This structure aligns with traditional regulatory frameworks while enabling instant 24/7 transfers between financial institutions.

BNY’s exploration reflects a growing industry shift toward blockchain-based infrastructure for institutional-grade settlements. The bank’s involvement adds credibility to tokenized deposit models, especially as global adoption of digital asset-based financial rails accelerates.

Global Collaboration and Industry Adoption

In July, BNY Mellon partnered with Goldman Sachs to offer tokenized money market funds for institutional investors, allowing real-time settlement and continuous market access. Participants in the initiative include BlackRock, Fidelity, and Federated Hermes, with asset ownership recorded on Goldman’s private blockchain.

BNY is also part of SWIFT’s consortium of over 30 financial institutions, developing a shared blockchain-based ledger for global payments. Meanwhile, banks like JPMorgan and HSBC have launched their own tokenized deposit pilots, signaling a coordinated industry shift.

In Asia, SBI Shinsei Bank, Partior, and DeCurret DCP recently signed an agreement to create a multicurrency blockchain settlement framework, underscoring the global momentum toward blockchain-based payment modernization.

As tokenized finance gains traction, BNY Mellon’s blockchain initiative could reshape how trillions in daily global payments are processed — making transactions faster, safer, and interoperable across borders in real time.

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