US Banks Launch Tokenized Deposit Network to Rival Stablecoins

Five major regional banks in the United States have come together to create a blockchain-based network for tokenized deposits. The initiative aims to address the rapid expansion of stablecoins while ensuring that customer funds remain within the regulated banking system.

The project, known as the Cari Network and led by former Comptroller of the Currency Eugene Ludwig, seeks to provide faster payments and improved efficiency. Additionally, a minimum viable product is set to launch later this month in, with a full rollout planned for the fourth quarter of this year.

Five Banks Unite Behind the Cari Network

The participating banks, with combined assets exceeding $779 billion, include Huntington Bancshares ($225 billion in assets) and M&T Bank ($214 billion in assets). First Horizon adds $84 billion, KeyCorp provides $184 billion, and Old National Bancorp rounds out the group with $72 billion.

These banks are working as design partners to shape a new platform for real-world use. They plan to test an early version of the platform later this month, with a full pilot scheduled for the third quarter. A customer rollout is expected by the end of 2026. The project focuses on tokenizing traditional bank deposits to create digital versions that can be transferred instantly.

These tokens will remain on the banks’ balance sheets as liabilities, potentially backed by FDIC insurance. The banks aim to maintain control over payment flows and prevent deposits from moving to unregulated crypto platforms. Additionally, the network will support real-time settlement, liquidity management, and programmable transactions using smart contracts.

ZKsync Prividium Powers the New Platform

Cari Network has chosen ZKsync’s Prividium infrastructure, developed by Matter Labs, as its technological foundation. The permissioned layer-two solution is built on zero-knowledge technology and is anchored to the Ethereum mainnet to ensure enhanced security and scalability.

The design guarantees that all activities remain under bank governance and comply with strict regulatory standards. Tokenized deposits will function similarly to stablecoins in terms of speed and transferability, while still providing the safety of insured bank deposits. Customers can expect seamless integration with their existing accounts and services.

Industry observers note that tokenized deposits and stablecoins are likely to coexist, each serving different segments of the market. Analysts predict significant transaction volumes as banks modernize their payment infrastructure. This development represents a pragmatic step for regional banks to adopt blockchain technology while maintaining their competitive edge against fintech rivals.

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