Payments giant Mastercard plans to launch pilot tests of Multi-Token Network (MTN), an initiative with which the company will experiment with tokenized bank deposits.
MTN, which will involve several banks and financial institutions, will be available in beta this summer in the UK.
Selected teams will have access to MTN's capabilities to develop promising use cases for tokenized deposits.
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Raj Damodaran, head of crypto and blockchain at Mastercard, expects that, over time, the initiative will also affect stablecoins and regulated CBDCs.
He has explained:
"What powers the global economy today is regulated money in the banks. So we’re starting with making tokenized bank deposits, so the unit of money in a bank account is a digital asset on the blockchain, bringing the same level of programmability to those as you find with digital currency in the crypto ecosystem."
The first types of applications and use cases Mastercard intends to promote with tokenized bank money are combined with the Mastercard Crypto Credentials project, which acts as a blockchain analytics service that ensures AML compliance.