UK's biggest banks execute first interbank transfers with tokenised deposits

In a landmark trial, the United Kingdom's largest banks completed the first interbank movements of money using tokenised deposits on a blockchain network. The test involved two remortgage transactions between Lloyds, NatWest and Barclays, where funds were released automatically once property transfers were confirmed, and a simulated buyer-seller payment involving HSBC and other lenders, with payment released only after delivery verification.

Tokenised deposits are ordinary bank deposits recorded on a blockchain, preserving the same legal status while allowing instant, condition-based settlement. The "Great British Tokenised Deposit" project, launched last year, links participants such as Lloyds, NatWest, Barclays, HSBC, Monzo, Nationwide and Santander and enjoys official backing from the Bank of England, which prefers this approach to privately issued stablecoins.

The banks plan to form a joint company, adopt a rulebook and issue three digital bonds by the first quarter of 2027, settled via tokenised deposits. The UK milestone follows a week of European developments, including the Eurosystem's Pontes platform and the ECB's investment in tokenised securities, highlighting a continent-wide shift toward regulated, bank-issued digital money.