Is the Autumn of Banking 'Coins' Just a Technological Showcase?

The number of stablecoin banking projects and tokenized deposits is increasing. Almost every week brings new reports of market debuts. A skeptic might say that while the construction is often interesting, the same goal can be achieved without "blockchains" and "tokens".

Banks around the world are experimenting with new forms of cashless money. They have no choice -- central banks may have their own "product" for the new financial infrastructure (CBDC) in the future, and non-bank stablecoin issuers were the first to market and are significantly outpacing their banking rivals in scale. The terms "banking stablecoin" and tokenized deposit regularly appear in reports about banking innovations, and October has brought a real flood of news.

JPMorgan Launches Token on Ethereum

On October 9, 2026, the American bank JPMorgan (yes, the same one whose CEO mocked cryptocurrencies) enabled transactions with its deposit token JPM Coin on the Ethereum blockchain. The token first appeared on the market back in 2019, but at that time it was a somewhat ill-conceived creation intended to test high-value transaction settlements. The second birth of JPMorgan's invention took place in November 2025.

Units of this "currency" (JPMD) represent dollars held in bank accounts. We are thus dealing with a tokenized deposit. Initially, trading the token was possible on the Base network, a layer 2 solution built on the Ethereum blockchain. Now JPMD can also be transferred directly on this popular distributed ledger, on layer 1.

However, using a public blockchain does not mean that the token can freely circulate among any entities. Access is limited to institutional clients approved by the bank, and transfers require special certifications. Smart contracts operating with JPMD can also only use a whitelist of addresses on the network. The technical aspects of JPMD's operation are handled by a bank-owned company -- Kinexys.

The bank advertises its solution as a mechanism for enterprises, financial institutions, and payment service providers. The token is designed to facilitate settlements, for example, in transactions with digital assets, providing the option for immediate and final settlement "on-chain", but simultaneously using bank money.

Having its own token is not the only venture JPMorgan is undertaking in the world of digital money. The institution is part of an alliance of banks creating the foundations for "SWIFT 2.0" infrastructure for international settlements, as well as, on the American front, a group of banks building a shared network for deposit tokens. For several months, it has also been offering two tokenized money market funds (MONY and JLTXX).

HSBC Has Its Own "Red Token"

A true banking stablecoin was introduced on October 27 by another major global bank -- HSBC. The token named RedCoin (RCHKD) will be available to consumers in Hong Kong using the PayMe app. The stablecoin is pegged one-to-one to the local dollar (HKD), and the new form of electronic money is supervised by the local financial regulatory authority HKMA. HSBC received the appropriate license in April of this year.

Users of the HSBC app will be able, after activating their wallets, to use RedCoin for settlements with other consumers or for payments at over 100,000 merchants currently participating in the PayMe system. The feature will gradually roll out to 3.3 million customers. The debut was preceded by tests conducted in recent months with a group of 100 employees of the institution.

The function is expected to be integrated with HSBC's m-banking as well. Stablecoin payments are also intended for purchasing a tokenized money market fund. Therefore, the initiative can be viewed not only as an addition of a new payment type but also as the first step in educating customers to operate in the world of digital assets.

HSBC announces the publication of regular reports reviewing the asset pool underlying the stablecoin issuance. The first review is expected to appear after the fourth quarter of 2026 and will be prepared by an independent external auditor. The bank's website features an issuance prospectus (the so-called whitepaper) and a policy for managing reserve assets, which includes an option for "over-collateralization" to neutralize the volatility of the valuation of some of the more risky components of the pool. Stablecoin holders will not receive any benefits (e.g., interest) from their tokens. Any potential losses or gains from managing reserve assets will be borne by the bank.

SOFIE: Promoting Deposits in a New Form

In the last days of October, the American bank SoFi also presented its deposit token. The product is charmingly named SOFIE and is a digital representation of a deposit offering 4.4% per annum. Bank customers can expect the same protection as with traditional deposits (FDIC guarantee), and interest is accrued until the token is sold. However, conversion is only possible to the stablecoin SoFiUSD, also issued by SoFi. This, in turn, is not a deposit in the legal sense and does not benefit from the guarantee system.

The bank's website presenting the novelty includes a visible warning that "digital assets can lose value" and are not insured by the FDIC. Of course, this does not apply to SOFIE as a tokenized deposit. Do consumers understand the difference between the various tokens offered by the same institution? This is one of the issues that will likely soon become a topic for regulators tasked with protecting consumer rights.

Analyst Ron Shevlin, who tracks the American retail banking market, points out that the deposit token has no advantages over a traditional savings account or deposit. For now, it is more of a marketing gimmick aimed at crypto enthusiasts and, perhaps, a preparation for building further elements of the digital asset ecosystem under one brand.

Banks Want to Be on Stage, but Not All Know Why

In the world of digital money, an evolution is underway from which new standards may ultimately emerge. For now, banks are experimenting with various possibilities and often do so on their own, without looking back at previous steps, including mistakes made by rivals. Reports of further token debuts are largely "strategic noise."

Ultimately, standardization will be most beneficial for banks, rather than the parallel development of dozens of stablecoins and various types of deposit tokens. Therefore, initiatives that gather many large players deserve attention. In Europe, the Qivalis consortium, which includes Bank Pekao, may be a candidate for leadership. The debut of a bank stablecoin linked to the euro is expected to occur later this year.