Canada’s Big Six banks jointly explore digital deposits network
The country’s bank regulator said earlier this month that tokenized deposits are permissible under existing legislation
Canada's six largest banks, including the Bank of Montreal, CIBC, National Bank of Canada, Royal Bank of Canada, Scotiabank, and TD Bank Group, are jointly exploring the concept of tokenized Canadian dollar deposits for interbank payments. This initiative aims to facilitate the movement of digital representations of bank deposits between financial institutions, with the first phase focusing on internal transfers before potentially expanding to other digital asset systems.
The announcement of this project was made on Tuesday, following the Office of the Superintendent of Financial Institutions (OSFI) providing additional clarity on the legal permissibility of tokenized deposits on September 10. OSFI clarified that tokenized deposits are not legally distinct from traditional deposits, emphasizing that the underlying technology of a financial product does not determine its legal nature.
The banks hope that this system will support faster and programmable payments, with longer-term plans to open the initiative to other deposit-taking institutions.
Brief written by urgent.news from Cointelegraph's own syndicated text. Machine-written — may contain errors; check the original before relying on it.
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