UK banks complete interbank tokenised-deposit transactions

Major UK banks completed interbank transactions using tokenised commercial-bank deposits in a project led by UK Finance. Participants included Lloyds, NatWest, Barclays and HSBC.

The trial used tokenised deposits in two remortgage transactions and in a simulated person-to-person online purchase. Unlike a privately issued stablecoin, the tokens represent commercial bank money and retain the legal relationship between a bank and its customer.

The project is intended to move from pilot work towards production, with further work on regulation and digital bonds planned. The tests show that bank deposits can be represented and moved through blockchain infrastructure; they do not mean the participating banks have replaced their existing payment and settlement systems.