Canada’s Big Six banks jointly explore digital deposits network
Canada’s six biggest banks launched a project to jointly explore digital money solutions , beginning with tokenized deposits , in what they say is a bid to bolster the country’s payments infrastructure.
The lenders announced the initiative, aimed at developing digital money based in Canadian dollars , in a statement Tuesday. A tokenized deposit is a digital representation of a conventional bank deposit that can be recorded and transferred using blockchain or similar technology, potentially allowing money to move and settle almost instantly and around the clock.
“This collaborative effort reflects a shared view that as digital money evolves globally, Canada’s payments infrastructure must continue to be competitive and secure,” according to the statement. The initiative comes as the Canadian government, led by Prime Minister Mark Carney, is pushing to strengthen Canada’s domestic economy and reduce its reliance on the United States amid heightened trade tensions.
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The participants in the initiative are Royal Bank of Canada , Toronto-Dominion Bank , Bank of Montreal , Bank of Nova Scotia , Canadian Imperial Bank of Commerce and National Bank of Canada . CIBC and Bank of Montreal didn’t immediately respond to requests for comment, while the other lenders declined to comment further.
The country’s bank regulator said earlier this month that tokenized deposits are permissible under existing banking legislation, saying they are “not legally distinct from traditional deposits.” The Canadian project follows plans announced in earlier this year for a consortium of major U.S. banks — including the U.S. arms of Bank of Montreal and Toronto-Dominion — to create a shared network connecting tokenized bank deposits in a bid to counter the growing competition for deposits posed by stablecoins .
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5News aggregated this summary from the outlet’s public feed. The full article, with all the context, is on financialpost.com — the content belongs to Financial Post.