DBS, J.P. Morgan Developing Cross-Blockchain Framework for Tokenised Deposit Transfers

A collaboration between DBS Bank and J.P. Morgan's blockchain unit Kinexys, announced today, aims to bridge DBS Token Services and Kinexys Digital Payments, allowing seamless exchange and settlement of tokenised deposits across both public and permissioned blockchain networks.

If successful, the framework could enable round-the-clock cross-border transactions between the banks' combined institutional client bases.

Under the proposed system, a J.P. Morgan institutional client could pay a DBS client using J.P. Morgan Deposit Tokens on the Base public blockchain, with the recipient able to exchange or redeem the tokens for equivalent value through DBS Token Services. The framework is designed to maintain fungibility of tokenised deposits across different banks and blockchains – a principle both institutions describe as critical in an increasingly fragmented digital asset landscape.

"Instant 24/7 payments provide businesses with the optionality, agility and speed to navigate global uncertainties and capture emerging opportunities," said Rachel Chew, group chief operating officer and head of digital currencies at DBS Bank, in a statement. "As the digital asset ecosystem continues to grow, interoperability remains a critical piece in reducing fragmentation."

Both banks currently operate separate blockchain-powered payment systems offering clients 24/7 liquidity and real-time settlement within their respective ecosystems. The new framework would create what the banks call "interoperability highways" between these platforms, expanding reach for cross-bank on-chain transactions.

"We are relentlessly focused on building the next-generation financial infrastructure, backed by deep industry expertise and strong collaborations across the globe," said Naveen Mallela, global co-head of Kinexys by J.P. Morgan.

The initiative comes as tokenised deposits gain traction globally. A 2024 Bank for International Settlements survey found that commercial banks in nearly one-third of jurisdictions have launched, piloted, or researched tokenised deposit products.

The partnership represents a significant step toward addressing fragmentation in the digital asset ecosystem, where multiple blockchain networks and token issuers have created compatibility challenges for institutional users seeking to move funds across platforms and borders.