Analysts at the Federal Reserve Bank of Dallas have published a study on the impact of tokenized deposits on the traditional banking system. Experts warn that widespread adoption of digital liabilities could alter the structure of bank funding and reduce the ability of credit institutions to transform short-term deposits into long-term loans. Unlike stablecoins, tokenized deposits operate within the regulated banking system and can generate interest income for holders, though at this stage they lag behind competitors in the convenience of interbank transfers. To address this issue, the largest American financial institutions — including JPMorgan, Citigroup, Bank of America, and Wells Fargo — plan to launch a unified tokenized deposit network in the first half of 2027.
The traditional banking model relies on relatively stable deposits to fund long-term loans. However, the ability to instantly move tokenized funds will make it significantly easier for customers to seek better terms at other institutions. The development of agentic artificial intelligence and smart contracts, capable of automating the reallocation of funds without direct depositor involvement, may serve as an additional catalyst for capital outflows. According to the study's authors, approximately eighty percent of the banking sector's asset duration — equivalent to roughly $5.8 trillion on a ten-year basis — is supported precisely by the characteristics of the deposit base.
A shift in depositor behavior could directly undermine the economy's lending capacity. Analysts calculated that a reduction in the average deposit lifespan of just ten percent could decrease the maturity transformation potential by approximately $580 billion. In turn, a ten percent increase in deposit sensitivity to interest rates would reduce banks' willingness to take on interest rate risk by roughly $700 billion on a ten-year basis. To maintain previous lending volumes, financial institutions will need to rely more heavily on term debt, which will inevitably drive up borrowing costs for businesses and households.
The instant movement of funds also increases the volatility of deposit balances and complicates the forecasting of outflows, forcing banks to build up larger reserves of high-quality liquid assets. As a concrete example, researchers point to Brazil's experience, where the Pix instant payment system has been operating since 2020. By the first quarter of 2026, the number of active users reached two hundred million, and monthly transaction volumes approached $650 billion. Analysis of regulatory data showed that active use of Pix stimulated bank demand for government bonds while simultaneously reducing the volume of credit intermediation. In the remaining portion of their loan portfolios, banks were compelled to increase the share of higher-risk loans in order to sustain overall return on capital.
Although tokenized deposits in the United States are still at an early stage of development, their further proliferation alongside stablecoins and money market funds could fundamentally reshape the payments infrastructure. Regulators will need to assess the scale of consequences for monetary policy, various types of credit institutions, and the role of the central bank as lender of last resort in a financial system where a significant portion of capital becomes digital and instantly transferable.