JPMorgan · U.S. · White House · Circle · CoinDesk
America’s largest banks are building a new digital currency network to stop a massive deposit drain
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America's largest banks are preparing a direct response to one of crypto's fastest-growing products: stablecoins.
Key facts
- In a report in March, Jeffries said it estimates that stablecoins could drive a 3% to 5% runoff in core deposits over the next five years and shrink average bank earnings by about 3%
- The biggest banks in America are voluntarily coming onchain," said Digital Chamber CEO Cody Carbone
- Stablecoins, specifically Circle’s (CRCL) USDC and Tether’s USDT, currently dominate that market
- JPMorgan Chase, Bank of America, Citigroup and other major lenders said Friday that they plan to launch a shared tokenized deposit network through The Clearing House by the first half of 2027
Summary
JPMorgan Chase, Bank of America, Citigroup and other major lenders plan to launch a shared tokenized deposit network through The Clearing House by the first half of 2027, enabling round-the-clock blockchain-based settlement of bank deposits. The initiative is designed to counter the rise of stablecoins such as USDC and USDT by keeping customer funds within the regulated banking system while offering similar speed and efficiency for payments and transfers. Analysts say the move underscores both banks’ growing concern that stablecoins could erode core deposits and the broader trend of traditional finance adopting blockchain technology, even as it maintains tighter control than public crypto networks.