BNY Mellon Tokenized Deposits Now Live for Ripple, Citadel, ICE - TradFi Giants Dive Into Digital Assets

Wall Street's oldest bank just rewired its plumbing for the crypto age.

BNY Mellon—the 242-year-old custodian of $46.7 trillion in assets—has flipped the switch on tokenized deposits for three financial heavyweights: Ripple, Citadel Securities, and Intercontinental Exchange (ICE). This isn't a pilot or a sandbox experiment. It's live, institutional-grade infrastructure moving real value on-chain.

From Vaults to Validators

The move transforms traditional bank deposits into programmable digital tokens. Think of it as giving a century-old checking account a blockchain brain. For clients like Ripple, it means near-instant, 24/7 settlement. For Citadel and ICE's Bakkt, it's a direct on-ramp to use regulated digital dollars within their existing ecosystems.

BNY Mellon isn't minting a new stablecoin. Instead, it's tokenizing the deposits it already holds—a regulatory sidestep that's both clever and cautious. The bank acts as both issuer and redeemer, maintaining full control over the underlying fiat. It's blockchain efficiency with a banker's risk aversion.

The Quiet Revolution in Settlement

Forget trading ape JPEGs. This is about moving millions between institutions before a coffee gets cold. Tokenization cuts through the legacy fog of correspondent banking, multi-day waits, and operational friction. It bypasses the traditional financial teleport—the one that somehow still takes three business days.

The implications are tectonic. Liquidity becomes programmable. Collateral can be mobilized in seconds, not days. Complex multi-party transactions can be automated with smart contracts. It's the back office getting a front-row seat to innovation.

A Cynical Nod to Tradition

Let's be real—the finance world loves a new system that does the old job, just with more steps and consultants. But here, the steps are actually fewer. BNY Mellon's play is a masterclass in embracing disruption without dismantling the vault. They've built a blockchain elevator in their marble skyscraper.

The silent message to the market is deafening: if the guardian of the old world's wealth is this deep in digital assets, the train has left the station. The race isn't about who will adopt—it's about who's already live. And for three major players, that day is today.

Bank of New York Mellon has entered the tokenized deposits race.

The bank, which holds $57.8 trillion in assets under custody, announced Friday that clients can now transfer deposits using blockchain rails. These on-chain deposits work for collateral, margin transactions, and payments, with BNY targeting 24/7 operations.

The first users include Intercontinental Exchange (which owns the New York Stock Exchange), Citadel Securities, DRW Holdings, Ripple Prime, asset manager Baillie Gifford, and stablecoin firm Circle.

“This is very much about connecting traditional banking infrastructure and traditional banking institutions with emerging digital rails and digital ecosystem participants in a way that institutions trust,” said Carolyn Weinberg, BNY’s chief product and innovation officer.

How Tokenized Deposits Work

Tokenized deposits differ from stablecoins in one key way. Stablecoins are backed by reserves like cash or short-term government debt. Tokenized deposits sit within the banking system itself and can pay interest.

This launch follows the passage of the GENIUS Act, which sets up stablecoin rules in the US.

Why This Matters for 24/7 Markets

Blockchain-based deposits could play a key role in tokenized securities, acting as the settlement LAYER for assets like stocks and bonds.

ICE plans to support tokenized deposits across its clearinghouses as it prepares for continuous trading. CEO Jeffrey Sprecher has previously said tokenization could help increase trading volumes by enabling round-the-clock collateral management.

BNY also pointed to programmable transactions, which allow transfers to execute automatically when certain conditions are met, such as releasing collateral once a loan obligation is fulfilled.

Banks Are Piling In

BNY joins a growing list. JPMorgan rolled out JPM Coin to institutional clients in November. HSBC plans to expand its tokenized deposit service to the US and UAE in the first half of this year.

In the UK, Barclays recently invested in Ubyx, a US startup building clearing systems for tokenized deposits. UBS, PostFinance, and Sygnum Bank have run Ethereum-based tests, while Swift is building on-chain settlement infrastructure.