On July 9, 2026, Swift announced that its blockchain-based ledger is ready for initial use. Seventeen major banks across six continents are preparing to run pilot live transactions using tokenized deposits. A tokenized deposit is an ordinary deposit of a bank’s customer, which the bank records on a distributed ledger rather than in a conventional banking system.
For the customer, the substance of the claim on the bank does not change: it remains a claim for the return of the funds. What changes is where the bank keeps the record of it.
Under the experiment, part of the bank customer’s funds will be placed in a tokenized deposit. This placement makes part of the customer’s funds available for transfers on a distributed ledger, which creates two possibilities for the customer:
- Immediate transfers between banks at any hour of the day and on non-business days. A distributed ledger updates continuously, so the funds can be transferred at any hour, including nights and weekends.
- The ability to execute reciprocal payments as a single operation. A distributed ledger can carry out two transfers as a single operation, so that either both take effect or neither does. This matters when each side of a deal has to hand over something at the same moment: shekels against dollars, or money against a security. Today one side normally moves first and carries the risk that the other does not follow. On a distributed ledger that risk does not arise.
Until now, tokenized deposits have been products of a single bank, circulating only among that bank’s own customers. What is new is that the instrument now has a shared environment that several banks can use. It was built by the operator of the existing global payments network, and it runs on the standards those banks already use. The announced pilot is aimed at cross-border corporate payments, treasury operations and foreign exchange settlement.
What Swift Built, and What Legacy Remains in Place
The distributed ledger is operated by Swift. It arranges the flow of transactions, checks that participants have committed the funds they owe, and coordinates the processes that run between banks. The banks operate their own environments.
Settlement itself continues to run through the channels banks use today: real-time gross settlement (RTGS) systems, correspondent banking relationships, or other arrangements agreed between the participants. The distributed ledger is built on the payment applications and Swift standards that banks already have in place, and it adds a single shared layer above them. That layer records the payment obligations between banks and confirms them. It draws on the compliance processes the banks already run, and it supports more than one method of settlement.
In practice, a payment works as follows. The paying bank cancels the tokens in its customer’s account, and the receiving bank issues new tokens to the payee. The receiving bank is then owed that amount by the paying bank, and the two settle it afterwards through the channels described above. The payee can use the funds straight away, at any hour, while settlement between the banks follows as it does today.
Stablecoins Compared with Tokenized Deposits
In everyday use, a tokenized deposit and a stablecoin look much the same. A stablecoin is a token designed to hold a steady value against a reference asset, usually a currency. Like a tokenized deposit, it can move at any hour and passes directly from one holder to the next.
In law they are not the same instrument. A tokenized deposit is a claim on the bank that issued it, and it sits on that bank’s balance sheet. In some jurisdictions that position is being confirmed expressly, including for the purposes of deposit protection. A stablecoin, by contrast, is a claim on a private issuer. It is backed by a separate pool of the issuer’s reserve assets and falls outside banking supervision.
