Financial institutions test stablecoin and tokenized deposit settlements

Major financial institutions are advancing the use of blockchain technology for payment settlements. In a recent pilot, Lloyds Banking Group used the dollar-pegged stablecoin USDC to settle $750,000 in obligations with Visa. The process, which included weekend transfers, allowed funds to arrive in under an hour through the bank’s Corporate Markets branch in Jersey.

Simultaneously, the Great British Tokenised Deposit (GBTD) initiative has completed the first live customer transactions using tokenized sterling deposits. Coordinated by UK Finance, the pilot involved several major banks, including Barclays, HSBC UK, Lloyds, Monzo, Nationwide, NatWest, and Santander. These transactions utilized infrastructure developed by Quant to enable interoperability between different banking systems.

Unlike private stablecoins, these tokenized deposits represent claims on regulated banks and offer programmable features. Tested applications included automated remortgage fund releases and consumer marketplace payments that trigger only upon the exchange of goods. Future testing aims to explore digital-asset settlement and the issuance of digital debt instruments.