Custodia, Vantage Bank launches platform for tokenized deposits

Custodia Bank and Vantage Bank have introduced a patent-protected, turnkey blockchain solution that allows traditional banks to issue tokenized deposits. These digital versions of bank deposits function on a blockchain, enabling banks to benefit from blockchain's low-cost, near-instant transactions while retaining control over customer deposits, thus mitigating the risk of disintermediation. The platform utilizes Custodia's bank-focused blockchain and Vantage's Interlace network, aiming to bridge the gap between crypto and traditional banking by creating a single digital token that acts as both a tokenized deposit and a stablecoin compliant with the GENIUS Act. Tokenized deposits are seen as a way for banks to compete with private stablecoins, which have raised concerns among regulators about potential outflows of traditional banking deposits. Custodia is already running pilot programs using this technology for cross-border payments, construction disbursements, and supply chain settlements.

(Source：Cointelegraph)