UK's Monument Bank Plans to Tokenize Up to 250 Million Pounds of Retail Deposits

Monument Bank in the U.K. is moving to tokenize up to 250 million pounds ($335 million) of retail customer deposits using blockchain infrastructure, a notable step as tokenization services from global financial firms such as JPMorgan and Citigroup have largely been limited to institutional clients.

CoinDesk reported on September 19 that Monument Bank plans to use Midnight, a privacy-focused blockchain, to tokenize as much as 250 million pounds ($335 million) of retail deposits.

The tokenized deposits will pay interest like conventional bank deposits and will be structured for one-to-one redemption in pounds. Coverage under the U.K.'s Financial Services Compensation Scheme will also remain in place within applicable limits.

Mintoo Bhandari, founder of Monument Bank, said there has not yet been a case in which retail customers can participate directly in tokenization. The service will be designed so customers can use it like a standard deposit product without needing to think about blockchain or crypto.

Monument Bank is also considering using the infrastructure to give retail customers access to fractional ownership of private equity, tokenized structured products and Lombard lending.

By contrast, JPMorgan has processed more than $3 trillion of transactions through its Kinexys blockchain platform, while Citigroup supports billions of dollars in cross-border payments each day through its token services. Those offerings, however, are mostly aimed at institutional clients and run on permissioned networks.