DeCurret, the developer of the Japanese tokenized deposit solution DCJPY, is collaborating with GMO Aozora Net Bank and Abeam Consulting to explore the interbank settlement of tokenized deposits.
Today many tokenized deposit solutions are single bank, meaning clients can only use the tokens for payments to other customers of the same bank. Platforms that support multi bank tokenized deposits involve a two step process. That includes the transfer of tokens between the payer and recipient, followed by an interbank payment from the payer’s bank to the recipient’s bank. This interbank step is the topic of this latest experiment, which has been designated as a Payment Innovation Project (PIP) by Japan’s Financial Services Agency (FSA).
Multi bank tokenized deposit solutions remain rare, but where they exist, interbank settlement is typically handled via the central bank’s real time gross settlement (RTGS) system or using a wholesale CBDC where available. However, RTGS systems operate on limited hours, and these restrictions can also affect the availability of wholesale CBDC, depending on the design. DeCurret is exploring two other routes. One is to use a stablecoin for the interbank payment. The other is to use a settlement bank, where all participating banks execute interbank payments via accounts held at that bank. There is precedent for this approach.
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