Versabank, a Canadian digital bank with a focus on business customers, started testing a tokenized down payment that the bank says it offers a safer and more conforming alternative to Stablecoins.
The pilot, who is led by the American subsidiary Versabank USA, will test an American dollar version of the blockchain-based Digital Deposit Receipts (GDRS) Tech in the bank. Each token, branded USDVB, represents one US dollar held on deposits at Versabank USA.
The program will simulate thousands of transactions of small value, first internally and then with selected external partners. Tokens are managed via the digital safe of the bank and the e-Wallet platforms and published on the Ethereum ETH$ 4,588.03Algorand Algo$ 0.2530 and stellar XLM$ 0.3838 block chains.
While stablecoins, crypto -tokens with prices linked to Fiat -Valutas such as the US dollar, the most attention has drawn, banks also investigated ground deposits to make money transfers more efficient with the help of blockchain rails. A stablecoin, such as Circle’s USDC or Tether’s USDT, is usually issued by a private company and supports the value of the tokens with reserves that are held at an external custodian. In the meantime, a tokenized down payment is a liability of a regulated bank and subject to bank rules.
Earlier this year, Custodia and Vantage Bank tokenisized the deposits of the US Dollar Question on Ethereum, while JPMorgan tested his deposit smoking on the Layer-2 Network Base of Coinbase.
Unlike most stablecoins, Versabank said that the tokens are federally insured and can earn interest, making them functionally comparable to traditional deposits, but with the extra efficiency of blockchain-based control.
The bank said that by the end of 2025 it was expected to end the pilot and will request approval from the office of the Currency (OCC) at a public launch.
Read more: Stablecoins, tokenization put pressure on money market funds: Bank of America