BNY Mellon Launches Pilot for Tokenized Deposits to Modernize Global Payments

The Bank of New York (BNY) Mellon, one of the world’s most influential financial institutions, is exploring tokenized deposits. 

This pilot is part of the bank’s long-term plan to reshape the global payments system using blockchain technology.

BNY manages $55.8 trillion in assets under custody, making it the largest custodial bank globally. Consequently, the new experiment signals its intent to modernize core infrastructure and remain competitive in a rapidly digitizing financial system.

Unlike traditional transfers, which can take hours or days, tokenized deposits can settle almost instantly. Moreover, they promise to lower transaction costs and simplify reconciliation across systems.

BNY currently handles about $2.5 trillion in payments daily. Therefore, by tokenizing part of that flow, the bank could dramatically improve transaction speed and transparency while reducing operational friction.

BNY Seeks to Overcome Legacy Constraints

According to Carl Slabicki, co-head of global payments at BNY Mellon, blockchain can help banks “overcome legacy constraints”.

In his view, tokenization could unlock faster, safer, and more efficient payment channels, both within the bank’s internal systems and across the broader global financial ecosystem.

Traditional banking infrastructure still relies on decades-old messaging and clearing technologies. As digital finance matures, large institutions like BNY are under pressure to evolve, ensuring that money can move as quickly as data.

Banks Worldwide Embrace Tokenization

BNY’s move adds momentum to a broader trend of banks exploring blockchain-based finance. For instance, JPMorgan began trialing its JPMD token on Coinbase’s Base blockchain in June. The move marked one of the first large-scale tests of on-chain deposits.

Meanwhile, in Europe, a consortium of nine major banks is developing a MiCA-compliant euro stablecoin designed for regulated use across the European Union.

Additionally, HSBC has already introduced tokenized deposit services for corporate clients, simplifying cross-border currency transactions.

Furthermore, the global messaging network Swift is developing a shared blockchain ledger prototype that could support near-instant international settlements.

Partnerships Strengthen BNY’s Digital Strategy

BNY’s interest in tokenization isn’t new. Earlier this year, it partnered with Goldman Sachs to introduce tokenized money market funds for institutional investors. That initiative enabled clients to buy and redeem shares digitally, thus bringing traditional financial products closer to the efficiency of blockchain technology.

At the time, BNY’s CEO Robin Vince had stated that the bank would continue to explore digital assets and tokenization, but would not compete aggressively for crypto-related deposits.