Custodia and Vantage Banks Launch Blockchain Platform for Secure Tokenized Deposits

Sean Williams

  • Custodia and Vantage launched a patent-protected blockchain system for tokenized deposits.
  • The platform lets banks issue digital deposits backed by U.S. dollars while staying compliant.
  • It positions banks to compete with the $300B stablecoin market safely and efficiently.

Two U.S. banks known for embracing digital innovation — Custodia Bank and Vantage Bank — have teamed up to launch a blockchain-powered platform that enables traditional banks to issue tokenized deposits. The goal: make banking faster, safer, and more competitive in a digital economy increasingly shaped by crypto and stablecoin

Bridging Traditional Banking and Blockchain

The new, patent-protected system allows banks to convert regular deposits into blockchain-based tokens backed by real U.S. dollars. These tokenized deposits operate as both a stablecoin and a standard bank deposit, merging the efficiency of digital assets with the trust of regulated banking.

Both banks emphasize that the system protects core deposits from being moved outside the banking network — a key concern for institutions wary of crypto disintermediation. Using Custodia’s blockchain infrastructure and Infinant’s Interlace network, participating banks can manage their own digital wallets while processing transactions more efficiently.

Competing with Private Stablecoins

The launch comes amid growing competition between traditional banks and private stablecoin issuers, a market now worth around $300 billion. Since the GENIUS Act was signed in July, stablecoins have gained fresh legitimacy, but many banks fear they could drain deposits if customers move funds into interest-bearing tokens.

By offering tokenized deposits directly, Custodia’s platform gives banks a way to compete without losing control over liquidity or compliance. It also creates a regulatory-friendly alternative to the fast-growing stablecoin market projected by the U.S. Treasury to hit $2 trillion by 2028.

Also Read: Pave Bank raises $39 million to scale world’s first programmable bank built for digital assets and AI era 

Testing Real-World Use Cases

Custodia is already testing its technology across cross-border payments, supply chain settlements, and payroll systems, proving its potential to streamline complex financial operations. If widely adopted, tokenized deposits could become the backbone of a new digital banking standard — one that keeps money within the banking system while delivering blockchain-level speed and transparency.

Custodia and Vantage’s partnership signals a pivotal moment for U.S. banking. By merging compliance-grade security with blockchain efficiency, their platform could redefine how banks issue, move, and secure digital money in the years ahead.

Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.

Related Posts