Canada's Six Largest Banks Develop Shared Digital-Dollar Network

Canada's six largest banks, RBC, TD, BMO, Scotiabank, CIBC, and National Bank, are collaborating to create a shared digital money infrastructure. They announced plans to explore a Canadian-dollar tokenized deposit system, initially focusing on interbank deposits rather than consumer wallets. A tokenized deposit represents a traditional bank deposit as a digital token on a shared ledger, maintaining the same money and rules but utilizing a different network. The banks aim to ensure the system is competitive and secure while adhering to existing safeguards for commercial bank money. They also intend to allow other Canadian deposit-taking institutions to join in the future. Currently, transferring money between banks in Canada is slow, but a shared token system could enable instant, round-the-clock settlements and programmable payments. Customers would not directly interact with this system, as it would operate in the background. This initiative is separate from the ongoing debate about a digital Canadian dollar, which received significant public feedback in 2023, with 85% of respondents indicating they would not use it. Previous attempts at digital cash in Canada have been unsuccessful. In the U.S., major banks are developing a rival tokenized deposit network, with a target launch in the first half of 2027. The six Canadian banks have not set a launch date for their project, which currently remains limited to transfers among the participating institutions.

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