Global financial institutions are gradually moving towards tokenization, to simplify asset transfers and settlements. In this dynamic, DBS Bank (Singapore) and Kinexys, the blockchain division of JP Morgan, are joining forces to create an interoperability framework allowing the smooth circulation of tokenized deposits between their respective platforms.
In brief
- DBS Bank and JP Morgan are collaborating to establish a common framework to facilitate the interbank transfer of tokenized deposits.
- The envisaged system would allow a JP Morgan client to send tokenized deposits on the Base blockchain to a DBS client, who would receive the same value via DBS Token Services.
Towards seamless interbank token transactions
This system aims to facilitate the transfer and settlement of tokenized deposits on public or private blockchains, establishing a benchmark for interoperability between platforms. Today, every bank already offers its customers 24-hour liquidity and instant settlements within its own blockchain environment. The collaboration aims to connect these environments via interoperable channels, enabling on-chain transactions between institutions, beyond technological boundaries.
In this modela JP Morgan client could transfer JP Morgan Deposit Tokens (JPMD) on the Base blockchain to a DBS client, who would receive an equivalent value on DBS Token Services. This approach maintains parity of tokenized deposits between platforms and builds confidence in a coherent multi-chain financial system.
Collaboration for reliable tokenized assets
Naveen Mallela, global co-head of Kinexys at JP Morgan, said the initiative demonstrates the company's commitment to developing a cutting-edge financial infrastructure built on collaboration and expertise. He added that “Working with DBS on this initiative is a clear example of how financial institutions can join forces to strengthen the benefits of tokenized deposits for institutional clients, while preserving the uniqueness of currency and ensuring interoperability between markets. »
On this point, Rachel Chew, Managing Director of Operations and Head of Digital Currencies at DBS Bank, highlighted that with the growing popularity of digital assets, interoperability becomes essential to reduce market divisions and enable the secure transfer of tokenized funds between different systems, while ensuring their full value.
Global momentum for tokenized deposits
The collaboration between DBS and JP Morgan is part of a broader industry shift towards blockchain-based deposits. In the UK, several major banks, including Barclays, Lloyds and HSBC, are participating in a live pilot of tokenized sterling deposits. This project, planned until mid-2026aims to demonstrate the concrete benefits that tokenized deposits can offer to individuals, businesses and the UK market as a whole.
This movement is also found in international research. According to a 2024 study by the Bank for International Settlements (BIS), about a third of commercial banks regions analyzed have already initiated, tested or explored the use of tokenized deposits.
In a similar move, Bank of New York Mellon in October reportedly evaluated tokenized deposits as part of its efforts to enable payments via blockchain networks. This development illustrates the continued commitment of major global financial intermediaries to expand on-chain settlement and integrate blockchain technology into everyday banking operations.
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