HSBC has completed a pilot of its Tokenized Deposit Service (TDS) on the Canton Network, marking its first simulation of issuing and settling tokenized deposits on a public blockchain designed for regulated financial institutions.
The test focused on the issuance, transfer, and atomic settlement of tokenized deposits against digital assets, demonstrating how traditional bank money can interact directly with blockchain-based instruments in real time. The pilot is part of HSBC’s broader effort to explore how tokenisation can improve settlement efficiency and interoperability across global financial markets.
Tokenized deposits are digital versions of money kept in a regulated bank, recorded on blockchain for instant, 24/7 payments. They are safer than stablecoins because they are direct bank liabilities and allow faster, programmable settlement.
Very excited to add @HSBC payments to @CantonNetwork. Soon we will show what’s possible when you have the right partners at the table. https://t.co/aEcIZu6PAo
— Yuval Rooz (@YuvalRooz) April 13, 2026
Tokenized deposits move closer to on-chain financial markets
The pilot reflects growing momentum around tokenized deposits as banks search for faster, programmable settlement systems. HSBC’s model allows fiat deposits to be converted into digital tokens on a 1:1 basis and transferred instantly across its ledger, with support for multiple currencies including USD, GBP, EUR, HKD, and SGD.
By testing on the Canton Network, HSBC demonstrated how tokenized bank money can operate in a controlled public blockchain environment while maintaining regulatory oversight and privacy features required by institutional markets. The bank said the experiment reinforces the role of interoperability in scaling digital financial infrastructure.
Banking sector accelerates blockchain integration
HSBC described the initiative as part of its long-term strategy to modernise payments infrastructure and enable real-time, 24/7 settlement. The pilot also explored how tokenized deposits could interact with other digital assets using atomic settlement, reducing counterparty risk and improving capital efficiency.
Digital Asset, the developer behind Canton, said tokenized deposits are gaining traction across capital markets and treasury systems, with increasing adoption from global financial institutions seeking programmable money infrastructure.
In another development, Canton Network announced a strategic partnership with RedStone Oracles to provide the critical data infrastructure for its growing real-world asset (RWA) ecosystem, valued at $6 trillion.
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