A tokenized deposit network built by five banks and a blockchain-based platform led by former Comptroller of the Currency Gene Ludwig is expected to be available to the banks’ customers in the fourth quarter, Bloomberg reported Wednesday (Feb. 18).By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions .Complete the form to unlock this article and ...

Bank of Korea Governor Rhee Chang-yong revealed South Korea is considering a new registration regime that would allow domestic institutions to issue virtual assets, while warning that won-denominated stablecoins could enable capital flow circumvention. Speaking at the Asian Financial Forum in Hong Kong, Rhee emphasized that exchange rate volatility could trigger rapid shifts into USD stablecoins and large fund transfers. The announcement comes as South Korean regulators remain deadlocked over comprehens ...

Group 1 - The New York Stock Exchange (NYSE) is developing a digital platform for 24/7 trading of digital tokens, separate from its traditional weekday operations [1] - This platform aims to enable instant settlement of transactions, dollar-sized orders, and stablecoin-based funding, enhancing trading flexibility [1] - The initiative is part of Intercontinental Exchange's strategy to expand transaction clearing capabilities for tokenized securities and potentially integrate tokenized collateral [3] Group 2 - Tokenization leverages blockchain technology to create digital tokens representing various assets, allowing for trading by anyone, anywhere, at any time [2] - Stablecoins, typically valued at $1, have increased the demand for tokenizing financial assets [2] - Intercontinental Exchange is collaborating with Citigroup, Bank of New York Mellon, and other lenders to facilitate tokenized deposits across its global clearinghouses [4]

Core Insights - BNY is prioritizing digital assets and new product solutions as part of its strategic focus [1] - The company reported a 22% year-over-year increase in net income, reaching a record $5.3 billion, and an 8% increase in revenue, totaling $20.1 billion for 2025 [2] Strategic Priorities - The four strategic priorities include focusing on digital assets, serving clients as One BNY, transitioning to a platforms operating model, and embracing artificial intelligence (AI) [2] - The One BNY model aims to integrate the company's offerings to provide a wider range of products and services to clients [4] - The platforms operating model is designed to enhance agility and intentionality within the company [4] - Embracing AI is intended to unlock capacity and allow employees to concentrate on higher-value client work [4] Product Innovations - BNY is innovating new products to build trusted market infrastructure and enhance client service, particularly in connecting traditional and digital asset markets [5] - The Dreyfus Stablecoin Reserves Fund was launched as a money market fund to hold reserves for stablecoins under the GENIUS Act, without investing directly in stablecoins [5] - The fund leverages BNY's expertise in cash and liquidity solutions for the digital payments ecosystem [6] - BNY has initiated the strategy to offer tokenized deposits by enabling on-chain mirrored representations of client deposit balances on its Digital Assets platform [6] Market Position - BNY's strong financial performance is attributed to its strategic initiatives and market-leading position in financial market infrastructure [3][7] - The company believes it is well-positioned to advance the future of financial markets due to its extensive client relationships and capabilities [7]

Core Insights - BNY, the world's largest custodial bank, is launching a platform for institutional clients to settle bank deposits on a blockchain, marking a significant step towards tokenization [1][2] - The platform aims to enhance settlement speed and liquidity management by mirroring client balances on a private blockchain [1][4] Group 1: Tokenization and Blockchain Implementation - BNY has been testing blockchain deposits to modernize its payment settlement process, with tokenized deposits being a key part of this initiative [2][3] - Tokenized deposits allow for faster operations across collateral, margin, and payments, while maintaining regulatory compliance [3][5] Group 2: Operational Details - The capability is now live on BNY's Digital Assets platform, enabling clients to represent their deposit claims as on-chain entries, which streamlines collateral and margin workflows [4] - The platform operates on a permissioned blockchain controlled by BNY, ensuring adherence to established risk, compliance, and control frameworks [5] Group 3: Industry Context - BNY is not alone in exploring blockchain settlement technology; other financial institutions are also transitioning to digital infrastructures for 24/7 asset settlement [6]

Group 1 - Barclays has made a strategic investment in Ubyx Inc., a U.S. compensation system for digital money, including regulated tokenized deposits and stablecoins [1] - The investment aims to enhance interoperability, which is essential for unlocking the full potential of digital assets, allowing regulated financial institutions to interact seamlessly [2][3] - Ubyx's mission is to develop a common global acceptance network for regulated digital money, emphasizing the importance of bank participation to ensure the redemption of nominal value through regulated channels [3] Group 2 - The investment comes at a time of increasing interest in new forms of digital money based on tokens traded on public blockchain infrastructures, with regulatory clarity progressing in various countries [3] - Both Barclays and Ubyx are committed to the responsible development of tokenized money within the regulatory framework [3] - Ubyx aims to facilitate the ubiquity of tokenized money by connecting various issuers with receiving institutions in a common regulatory environment [5]

Core Viewpoint - JPMorgan Chase is considering entering the cryptocurrency trading market for its institutional clients, reflecting a growing interest in digital assets amid a more favorable regulatory environment [2][3]. Group 1: JPMorgan's Plans and Market Response - The largest bank in the country is exploring potential products and services for its markets division to expand its digital assets business, which may include spot and derivatives trading [2]. - This initiative is a response to increasing interest in digital assets, particularly as the regulatory landscape has become more accommodating [2]. Group 2: Regulatory Developments - The Office of the Comptroller of the Currency (OCC) recently stated that banks can engage in riskless principal transactions involving crypto assets, signaling a shift in regulatory stance [4]. - The OCC has also issued new national bank trust charters to five applicants in the digital asset and blockchain finance sectors, which could provide significant operational advantages [4]. Group 3: Blockchain Integration - JPMorgan has been active in blockchain technology, recently arranging a U.S. commercial paper issuance on the Solana blockchain, marking one of the earliest debt issuances on a public blockchain [4][5]. - This issuance is considered a significant milestone for financial markets globally, indicating a shift in blockchain technology from a niche concept to a potential core banking infrastructure [5][6]. - Major financial institutions, including JPMorgan, are increasingly exploring blockchain for various applications, such as tokenized deposits and programmable payments, integrating it into modern financial operations [6].

Core Insights - The stablecoin market is evolving beyond a two-horse race between Tether's USDT and Circle's USDC, with significant growth and adoption expected in the near future [1][2] Market Growth - Total stablecoin market capitalization reached $300 billion in September, marking a 75% increase from the previous year [5] - Citi has revised its 2030 forecast for stablecoin issuance to $1.9 trillion in its base case and $4 trillion in a bull case, up from $1.6 trillion and $3.7 trillion, respectively [5] Adoption and Use Cases - Stablecoin adoption is "exploding" due to their advantages over traditional payment systems, such as 24/7 settlement and digital-native money movement [2] - Payment platforms, payroll providers, and corporate treasury solutions are increasingly considering stablecoins as part of their operational stack [4] Regulatory Environment - Regulatory clarity is attracting traditional financial players, including banks and fintechs, to the stablecoin sector [6] - As regulations become clearer, broader adoption from traditional finance is expected, as stablecoins align with existing use cases [6] Emerging Alternatives - Banks are launching tokenized deposits as an alternative to stablecoins, offering similar benefits like low transfer fees and faster settlement while operating under existing regulatory frameworks [7]

Core Viewpoint - The Czech National Bank (CNB) has initiated a $1 million Bitcoin purchase to gain real-world experience with digital assets, acknowledging the potential for significant volatility in their value [1][2]. Group 1: Purpose and Strategy - The CNB's portfolio aims to provide hands-on experience with digital assets rather than relying on theoretical models, focusing on understanding tokenization and custody processes [2]. - The portfolio was created on October 30 and includes Bitcoin, dollar-denominated stablecoins, and tokenized deposits, with Bitcoin trading near $110,670 at the time of purchase [4]. Group 2: Investment Rationale - Bitcoin was included in the portfolio due to its low correlation with traditional assets, which can help diversify large portfolios [3]. - Simulations indicated that a 5% allocation to Bitcoin could have increased annual returns by approximately 3.5 percentage points over the past decade, albeit with a significant increase in portfolio volatility [5]. Group 3: Operational Challenges - A technical study by the CNB highlights significant operational hurdles in managing Bitcoin, particularly the risk of losing private keys, which is unique compared to traditional asset management [7]. - The CNB has consulted with the European Central Bank and the IMF, which concluded that Bitcoin cannot be classified as an official reserve asset and should be listed as "tangible and intangible assets" on the balance sheet [8][9]. Group 4: Regulatory Perspectives - Major European central banks have mixed views on cryptocurrencies, with some, like the Swiss National Bank, stating that they do not meet reserve policy requirements [10]. - Ukraine's central bank has expressed concerns that Bitcoin could create additional vulnerabilities, especially in wartime financial stability [11].

Group 1: Investment Preferences - The company favors certain investment banking plays, highlighting Deutsche Bank, UBS, and Barclays as attractive options due to their cost measures and valuation, with Barclays trading at approximately seven times earnings compared to Goldman Sachs at 15 times earnings [1] - Net West is noted for its strong performance as a pure retail bank in the UK, achieving an 18% return, indicating a healthy operating environment [1] - Southern European banks like Inasa are also included in the list of preferred stocks, suggesting a broader regional interest [1] Group 2: Concerns on Swedish Banks - The company expresses a lack of enthusiasm for Swedish banks, citing their high valuations and limited total yields, which contribute to constrained earnings growth [2] - There is a perception that the quality gap between Swedish banks and their European counterparts has significantly declined since the global financial crisis [3] Group 3: M&A Activity - The company anticipates limited M&A activity in European banks moving forward, despite some successful transactions this year, with Italy being a potential area for future M&A [3][4] - Acknowledgment of the high failure rate of past M&A transactions suggests skepticism about the viability of future deals in the sector [4] Group 4: Digital Banking and Cost Management - European banks are perceived to be lagging in digital banking advancements, raising concerns about their competitiveness against American banks over the long term [5][6] - The company notes that European banks are managing cost growth more effectively, with increases of 2-3%, compared to 5-10% in American banks, indicating a disciplined approach to cost management [5]