Canada’s Six Biggest Banks Explore Tokenized Deposits for 24/7 Blockchain Payments
Canada’s six largest banks are jointly exploring a Canadian-dollar tokenized deposit system that could support faster and programmable payments around the clock. The initiative brings together Bank of Montreal, Royal Bank of Canada, Toronto-Dominion Bank, Scotiabank, National Bank of Canada and Canadian Imperial Bank of Commerce.
The project is still at the exploration stage and does not represent a live consumer payment network. The banks said the first phase will focus on moving tokenized deposits between Canadian financial institutions, with a longer-term objective of connecting the system with other emerging digital-asset initiatives.
Canada’s Big Six Move Toward Tokenized Deposits
Tokenized deposits are digital representations of deposits held with regulated banks. Unlike stablecoins issued by separate cryptocurrency companies, the underlying funds remain connected to deposits at the participating financial institution. The distinction could allow banks to bring blockchain-based payment functionality into existing financial infrastructure rather than creating an entirely separate form of money.
The banks said the initiative is intended to support faster, more efficient and programmable payments while maintaining safety, stability and regulatory oversight. The planned infrastructure could eventually allow payments to operate outside traditional banking hours, although the current project is focused first on institutional transfers rather than a broad consumer rollout.
The six participants represent the largest banking institutions in Canada: Bank of Montreal, Canadian Imperial Bank of Commerce, National Bank of Canada, Royal Bank of Canada, the Bank of Nova Scotia and TD Bank Group. The group also said other deposit-taking institutions could be included at an appropriate stage as the project develops.
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The timing follows an important regulatory clarification. On September 10, Canada’s Office of the Superintendent of Financial Institutions said tokenized deposits are not legally distinct from traditional deposits and that the technology used to deliver a financial product does not determine its legal nature. OSFI also said financial institutions remain responsible for meeting applicable legal, technology and risk-management requirements.
That clarification gives Canadian banks a clearer framework for examining blockchain-based deposits. It does not, however, mean every proposed tokenized deposit product is automatically approved. OSFI expects institutions to engage with their supervisors before launching novel products and to comply with existing requirements covering technology and third-party risks.
The project also builds on earlier Canadian experiments with distributed ledger technology. In March, the Bank of Canada, RBC, TD and Export Development Canada completed Project Samara, which involved issuing, trading and settling a C$100 million tokenized bond using distributed ledger technology and wholesale central bank deposits.
Blockchain Payments Become the Next Test
Project Samara demonstrated that tokenization could be used across a financial asset’s lifecycle, but the new bank initiative shifts attention toward payments and the movement of commercial bank money. The first phase is expected to examine how tokenized deposits can move between participating financial institutions rather than focusing initially on public blockchain activity or retail cryptocurrency payments.
For banks, programmable payments could create new settlement options for businesses and financial institutions. Payments could potentially be linked to predefined conditions, automated workflows or other digital assets, reducing the need for separate reconciliation processes. The banks have not yet provided a commercial launch date or confirmed the final technical architecture.
The initiative also places Canadian banks within a broader international push toward tokenized financial infrastructure. Banks in the United States and other markets are developing deposit-token systems and blockchain-based settlement networks, while global financial infrastructure providers are testing tokenized deposits for around-the-clock payment and settlement applications.
Related: Ripple Joins 54-Firm UK Taskforce to Scale Tokenization Across Financial Markets
Canada is simultaneously developing other forms of digital money infrastructure. The new bank project therefore arrives as tokenized securities, regulated stablecoins and blockchain settlement experiments are expanding across the financial sector. The six-bank model could provide a common institutional framework if the technology moves beyond the testing phase.
There are also significant technical and governance questions still to address. A shared network among competing banks would require common standards for settlement, interoperability, cybersecurity, identity, compliance and dispute resolution. Project Samara itself found that DLT experiments can deliver efficiency gains while introducing new governance, technology and integration challenges.
For the cryptocurrency and blockchain industry, the development is notable because major banks are increasingly examining blockchain as payment infrastructure rather than simply as a vehicle for trading digital assets. Canada’s Big Six have not announced a new cryptocurrency or committed to replacing existing payment systems, but their joint exploration shows that tokenized bank money is becoming part of the discussion around the future of financial settlement.
The next stage will determine whether the concept can move from a coordinated experiment into usable infrastructure. For now, the banks are testing how Canadian-dollar deposits could operate in tokenized form while remaining inside the regulated banking system. If the project progresses, it could give Canadian businesses and financial institutions another route for faster, programmable payments operating beyond the traditional banking timetable.
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