News
Public · Published
Banks found a way to copy stablecoins without losing the money that funds their loans
Banks are creating tokenized deposits, which are digital versions of traditional bank money, to compete with stablecoins. Falcon Finance's Artem Tolkachev says the real motive is protecting their balance sheets, not just modernizing payments with programmable money and around-the-clock settlement.
Published:
Updated:
What happened
Banks are creating tokenized deposits, which are digital versions of traditional bank money, to compete with stablecoins. Falcon Finance's Artem Tolkachev says the real motive is protecting their balance sheets, not just modernizing payments with programmable money and around-the-clock settlement.
Confirmed
Global impact / market context
Stablecoins could pull deposits away from banks, reducing the cash available for loans. By issuing tokenized deposits, banks aim to keep that funding, safeguarding their ability to lend and earn interest, which supports their profits and overall financial stability.
Analyst inference
This move shows banks responding to competition from stablecoins, which offer fast, round-the-clock transfers. Tokenized deposits could help banks retain customer funds and preserve their role in the payment system, potentially slowing the shift of money away from traditional banking.
Analyst inference
What to watch
- Watch whether banks roll out tokenized deposits more widely, as Tolkachev indicates this is a key strategy to protect their balance sheets from stablecoin competition. Confirmed
- Investors should consider how tokenized deposits might affect bank lending capacity and profitability, since keeping deposits could maintain loan funding and interest income. Proposed
- Monitor regulatory responses to tokenized deposits, as new rules could shape whether banks successfully adopt this technology to compete with stablecoins. Analyst inference