{
  "id": 16535024,
  "title": "[Insight] JPMorgan and BNY’s Tokenization Test: Settlement Speed and Funding Costs",
  "url": "https://urgent.news/2026/10/26/insight-jpmorgan-and-bnys-tokenization-test-settlement-speed-and",
  "topic": "tech",
  "section": "Tech",
  "published": "2026-10-26T00:19:11.000Z",
  "source": {
    "name": "Korea IT Times",
    "slug": "korea-it-times",
    "url": "https://www.koreaittimes.com/news/articleView.html?idxno=158504"
  },
  "original_language": "en",
  "account": "JPMorgan and BNY have recently announced experiments with tokenizing U.S. Treasury securities and JPM Coin, their dollar deposit token. However, these developments may not automatically result in faster settlement times or lower funding costs for clients. Tokenized deposits must support asset purchases, and those assets must become usable collateral for further financing in order to deliver tangible benefits.\n\nBNY connected a Treasury security purchase to a short-term financing arrangement by tokenizing the security and using it as collateral in an overnight repo transaction with Citadel Securities. The settlement for this transaction was completed within minutes, demonstrating the potential for reducing capital tie-ups and improving liquidity. However, BNY did not disclose key transaction details such as size, funding rate, or collateral haircut, making it difficult to assess the actual cost savings.\n\nJPMorgan's public blockchain expansion with JPM Coin on Ethereum has shown no supply or transfers as of October 22, 2025, on its Ethereum contract, according to digital asset analytics firm Sentora. While this does not prove no transactions have occurred, it does suggest the need for more comprehensive measures to evaluate the effectiveness of tokenization. These could include transfer value over time, repeat user activity, issuance and redemption frequency, and the specific purpose of transactions.\n\nWhile JPM Coin's and BNY's experiments may provide some technical foundations for interaction between deposits and fund tokens on the same blockchain, these products are not automatically connected through a complete transaction process. The practical value of tokenization depends on the consistent functionality of various steps, including asset transfer approvals, payment conditions, and operating hours. Simply processing transactions faster does not guarantee reduced funding costs or improved client outcomes.",
  "summary": "Putting bank deposits and Treasury securities on a blockchain does not automatically make clients’ money move faster or reduce their funding costs. Tokenized deposits need to support asset purchases, and those assets need to become usable collateral for further financing. Recent announcements from JPMorgan and BNY illustrate where the results of bank tokenization should be measured.On October 19,…",
  "key_points": [
    "JPMorgan and BNY experimenting with tokenizing U.S. Treasury securities and JPM Coin.",
    "Tokenization may not automatically reduce settlement times or funding costs for clients."
  ],
  "editors_take": "Technical speed in tokenized settlements offers little value unless banks create seamless, end-to-end processes that turn digital assets into usable collateral for broader financing and liquidity needs.",
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}