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Wells Fargo to launch tokenized deposits on blockchain for select clients
The rollout will begin with 24/7 U.S. dollar to British pound transactions for select corporate clients, with expansion to more clients and currencies in 2027.
Wells Fargo is preparing to launch tokenized deposits later this year, starting with a limited dollar to pound exchange service for select corporate clients, CoinDesk reports. The bank said payments will run on its proprietary blockchain and be automatically routed through existing client interfaces when it improves speed or flexibility.
Tokenized deposits, as described by Wells Fargo, are conventional bank balances recorded on a blockchain. The bank said they will remain commercial bank money and are expected to carry the same regulatory protections and deposit insurance eligibility as its existing deposit products, according to CoinDesk.
Wells Fargo also outlined future capabilities that include conditional payments using smart contracts, with the system potentially supporting in-house custodial wallets and connections to other blockchains. The initial rollout is planned to expand to more clients, countries, and currencies throughout 2027.
The bank’s move follows other large banks that have already launched institutional tokenized-deposit services, including JPMorgan and Citi, as they compete with the rising threat of stablecoins reducing deposit bases. CoinDesk also notes Wells Fargo previously applied for a trademark associated with “WFUSD,” which could relate to a deposit token or stablecoin, and that it has been building blockchain settlement rails since at least 2019.