DBS, OCBC and UOB have completed live domestic Singapore dollar transactions using tokenized deposits on Swift’s blockchain based ledger, marking the first time the three banks have executed interbank tokenized deposit payments between them.
All three banks have already completed cross border transactions on the Swift Ledger in recent weeks. What’s new here is the domestic use case, and it positions Swift’s ledger as Singapore’s de facto interoperability layer for tokenized deposits.
Most tokenized deposit platforms today are single bank systems. A corporate client at DBS can make tokenized payments to other DBS clients, but not to a client at UOB. That limits the potential of tokenized deposits as a payment network, unless the bank is huge. Domestic interoperability changes that equation.
Several jurisdictions are building similar domestic interoperability layers. In the United States, The Clearing House is developing a tokenized deposit network for its member banks. The UK’s GBTD project connects the six largest UK banks using API based orchestration. In Germany and the EU, the Commercial Bank Money Token initiative uses UDPN, a DLT orchestration network not dissimilar to Swift’s approach. Singapore’s three largest banks have reached the same destination through Swift rather than a bespoke domestic scheme.
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