Summary
- The BankChain Alliance, comprising thirty-nine state bankers associations, aims to establish a blockchain infrastructure managed by banks.
- This network is intended to facilitate tokenized deposits, stablecoins, programmable payments, and automated settlements.
- Details regarding technology providers, network architecture, governance, and regulatory compliance remain undisclosed.
In a significant development for the banking sector, thirty-nine state banking associations have united to form the BankChain Alliance, which is set to create a collaborative blockchain network specifically for community and regional banks.
The announcement made on Tuesday outlines the alliance's goal to support a wide range of services, including tokenized deposits, stablecoins, programmable payments, and automated settlements for numerous U.S. financial institutions, with a target launch year of 2027. However, the alliance has not yet revealed the technology provider, specific blockchain technology, governance structure, or the banks that will participate.
The coalition emphasized that this shared network will enable banks of various sizes to leverage blockchain technology while adhering to current regulatory requirements.
Kathy Kraninger, the Interim Chair of the BankChain Alliance and President and CEO of the Florida Bankers Association, stated, "Through an unprecedented collaboration representing thousands of banks, the BankChain Alliance is developing a secure, regulated, industry-built and industry-owned network that allows institutions of all sizes to provide modern capabilities so they can continue serving customers safely and efficiently in rural, urban, and regional communities across the country."
The participating banks represent a broad geographical range across the United States, including associations from states such as Texas, Florida, Georgia, the Carolinas, Pennsylvania, Massachusetts, Michigan, Wisconsin, Washington, and Oregon. Additionally, smaller markets like Maine, Vermont, Hawaii, Idaho, North Dakota, South Dakota, and Wyoming are also represented. Ohio's participation comes through the Ohio Bankers League, while the rest are organized as state bankers associations.
While the alliance claims that banks will own the network, it has not provided specific information regarding its interoperability, whether it will utilize established blockchains like XRP, Ethereum, or Solana, or how the issuance and settlement of tokenized deposits and stablecoins will be managed.
As of now, the BankChain Alliance has not responded to inquiries from Decrypt.
In recent years, banks and payment providers have been actively exploring blockchain solutions for deposits and continuous settlement processes. In October, Custodia Bank and Vantage Bank Texas launched an interoperable platform for tokenized deposits tailored for U.S. banks. Following that, in November, JPMorgan introduced its JPMD deposit token on Base for institutional clients, with plans for expansion to other networks and currencies. In January, BNY unveiled a private, permissioned platform for tokenized deposits aimed at collateral and margin transactions. Moreover, in July, Swift announced that seventeen global banks would begin testing tokenized-deposit transfers outside of standard banking hours.