Mastercard UK To Test Tokenized Bank Deposits

Updated: 28 June 2023

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What Mastercard is setting up a testbed in the UK for tokenized bank deposits
Why Mastercard wants to make cross-border transactions more efficient and secure
What Next It will be provided in conjunction with its blockchain analytics application, Mastercard Crypto Credentials, to promote digital asset transactions in the banking sector

Mastercard is creating a testbed called the Multi-Token Network (MTN) to explore the use of digital assets in banking.

Initially, the focus will be on tokenized bank deposits, allowing money in bank accounts to be represented as digital assets on the blockchain. This will make transactions more programmable and efficient.

Excited & proud to announce @Mastercard Multi-Token Network.

MTN will provide a set of foundational capabilities to help develop safe, secure, scalable & interoperable financial applications using digital assets.

Register your interest in our Innovation Sprint below. https://t.co/3DcOAlDThs

— raj dhamodharan (@raj_dhamodharan) June 28, 2023

MTN will be launched in the UK as a beta version this summer, and Mastercard is inviting banks and financial institutions to participate.

In the future, the initiative aims to include central bank digital currencies (CBDCs) and regulated stablecoins.

By tokenizing bank deposits, Mastercard wants to enable faster and more flexible cross-border transfers of value.

For example, if a bank in the UK has tokenized bank deposits and another bank in Singapore has them too, the two can easily exchange them.

This eliminates the traditional challenges associated with international transfers.

Eyeing Compliance

This scheme is part of Mastercard’s goal to use blockchain technology to ensure compliance with regulations like anti-money laundering.

The company is also working on an application called Mastercard Crypto Credentials, which helps monitor transactions for compliance.

Mastercard’s MTN and other initiatives are aimed at exploring how digital assets can revolutionize banking and make cross-border transactions more efficient and secure.