Wall Street's largest financial institutions are moving beyond cryptocurrency trading and building blockchain-based infrastructure for everyday banking operations. Citi, Mastercard, Visa, JPMorgan Chase, Bank of America, and more than 50 other financial firms are actively testing systems for stablecoin settlement, tokenized deposits, and asset transfers, marking a fundamental shift in how institutional finance may operate in the coming years.

What Are Stablecoins and Tokenized Assets?

Before diving into what's happening on Wall Street, it helps to understand the building blocks. A stablecoin is a digital currency designed to maintain a stable value, typically pegged to the US dollar or another asset. Tokenization means converting real-world assets, like bank deposits or company shares, into digital representations that can be transferred on blockchain networks. These aren't speculative trading instruments; they're tools designed to make financial transactions faster and more efficient.

The shift toward these technologies represents what industry analysts describe as a new phase in institutional crypto adoption. Rather than focusing on trading desks and exchange-traded funds (ETFs), major financial institutions are now targeting the core infrastructure that underpins the entire financial system.

Which Major Banks Are Building This Infrastructure?

The scale of institutional involvement is striking. Leading payment networks and banks are advancing several parallel initiatives:

• Mastercard: Announced it will add stablecoin settlement options for issuers and payment acquirers by June 2026, allowing faster and more efficient payment processing.
• Visa: Is collaborating with Brale to test private stablecoin settlement on the Canton Network, a privacy-focused blockchain infrastructure designed specifically for institutional use.
• JPMorgan Chase, Citigroup, Bank of America, Wells Fargo, and The Clearing House: Are jointly developing a tokenized deposit network led by banks, with a targeted launch in the first half of 2027.
• Citi: Rolled out its Digital Depositary Receipts solution in June 2026 for private company shares, creating a new channel for investors seeking access to pre-IPO companies.
• The Depository Trust and Clearing Corporation (DTCC): Launched a tokenization service involving more than 50 financial firms, with limited production operations for select tokenized real-world assets beginning in July 2026 and broader rollout planned for October 2026.

The breadth of participation signals that this is not a fringe experiment but a coordinated effort across the financial establishment.

How Are Banks Expanding Tokenization Beyond Deposits?

Tokenization is expanding far beyond simple deposit transfers. BlackRock, which launched its first tokenized money market fund called BUIDL in 2024, has filed to expand its range of tokenized fund offerings. In May 2026, Finance, JPMorgan Chase's Kinexys division, Mastercard, and Ripple completed a pilot program that allowed redemption of tokenized US Treasury funds through blockchain infrastructure, demonstrating that even government securities can be tokenized and traded more efficiently.

Stock tokenization is also gaining traction. Coinbase has revealed plans to offer tokenized US equities to clients outside the United States, while Kraken's parent company, Payward, has highlighted tokenized initial public offering (IPO) access through its xStocks platform. These developments suggest that traditional investment products may soon exist in both traditional and blockchain-based forms.

Supporting these products, large-scale infrastructure is being established for settlement and custody. The DTCC's announcement in May 2026 that it had launched a tokenization service involving more than 50 financial firms represents a critical milestone. Limited production operations for select tokenized real-world assets are slated to begin in July 2026, with a broader rollout planned for October 2026.

Why Does Custody Matter in This Transition?

Custody, the secure storage and management of digital assets, has emerged as a foundational layer for institutional adoption. In May 2026, Standard Chartered announced it would acquire the crypto custody business of Zodia Custody and integrate it into its own infrastructure, signaling that traditional banks view digital asset custody as essential to their future operations.

"Digital asset custody services form the foundational layer for all digital asset use cases in financial institutions," according to a report published in February by Ripple in collaboration with Quinlan and Associates.

Ripple and Quinlan and Associates, February 2026 Report

This emphasis on custody reflects a broader recognition that institutional adoption of blockchain-based finance requires the same level of security, regulatory compliance, and operational rigor that traditional finance demands.

What Does This Mean for Everyday Banking?

The practical implications are significant. If these initiatives succeed, banking operations like money transfers, securities issuance, and transaction settlement could become faster, cheaper, and more transparent. A stablecoin settlement system could reduce the time it takes to complete a payment from days to minutes. Tokenized deposits could allow customers to move funds between institutions more seamlessly. Tokenized securities could democratize access to private company shares and government bonds.

Notably, consumer-facing applications are already emerging. SoFi, a digital banking platform, has launched its SoFiUSD stablecoin on its consumer banking platform and named Bullish as its first centralized exchange partner. The company's management emphasized that this move aims to reduce a long-standing barrier between crypto assets and traditional finance, bringing blockchain-based financial tools to retail customers.

The convergence of these initiatives suggests that blockchain is transitioning from a speculative asset class to operational infrastructure within the financial system. The involvement of the DTCC, the Federal Reserve's banking partners, and major payment networks indicates that this shift has institutional and regulatory backing. Whether these systems launch on schedule and achieve widespread adoption remains to be seen, but the scale and coordination of current testing efforts suggest that Wall Street is betting heavily on blockchain-based finance becoming a core part of how money moves.