Custodia Bank and Vantage Bank publish a monetization payment scheme that attempts to place bank deposits and stable coins in the same asset structure. According to two companies, the system has been in operation in Ethera since March this year and is currently being tested with participating banks and is scheduled to be opened to banks and customers in the fourth quarter of 2026.
The same coin corresponds to two forms.
According to the White Paper released on 18 June, this token will switch legal and operational attributes in different scenarios.
Within the Hazel Bank network, it is considered to be a deposit issued by participating banks. When transferred to users or platforms outside the Alliance, it is converted to a stable currency supported by cash and short-term United States Treasury debt. In other words, the assets themselves remain continuous, but the legal identity changes with different positions of possession.
Continue the existing banking system
Custodia and Vantage stated that the Hazel network was oriented towards tokenized deposits, stable currency and other chain-based financial assets, with the aim of enabling banks to provide block-chain payment services over existing infrastructure, rather than rebuilding the entire core system.
According to the White Paper, Hazel could operate in parallel with the existing core banking software, payment corridors and accounting systems. Participating institutions could access the chain without large-scale re-engineering backstage.
According to two companies, the programme is targeted at financial institutions of different sizes, including community banks and credit unions. One of its design ideas is to keep customer deposits within the regulated banking system rather than to third-party stabilizers.
Banks accelerate the monetization of their deposits
As the use of stabilization currency in payments and settlements expands, the banking sector is accelerating the search for alternatives. As a result, monetized deposits have become the direction of more recent discussions.
The Wall Street Journal earlier this month reported that The Clearing House, held by Morgan Chase, American banks and Citigroup, was preparing a monetization deposit network that could be launched as early as the first half of 2027. The system also wishes to use block chains to express the customer ' s deposits for settlement purposes.
At the same time, some banking groups are opposed to allowing stable currency issuers to provide interest-bearing products. Jamie Dimon, Chief Executive Officer of Chase Morgan, recently stated that the banking sector would continue to oppose some of the provisions of the United States Encrypted Market Structures Act (CLARITY Act) because these arrangements could allow encryption companies to compete for deposits without a bank licence.
DefiLlama data show that the size of the stable currency market has increased from approximately $25.1 billion a year ago to about $31.5 billion. The growth also explains why banks have been more active in advancing the chain payments and deposit monetization programme.
Additional information:For Custodia, prior to the launch of the Hazel project, the company had been in dispute with regulators over access to traditional payment systems for many years. In March this year, the United States Court of Appeals for the Tenth Circuit did not support the resumption of proceedings against the Federal Reserve, after the regulator had refused the bank ' s main account application.