Monument Bank to launch UK's first £250M tokenized deposits

• Monument Bank plans to tokenize up to 250 million pounds ($335 million) of retail customer deposits on the Midnight network.
• This project is the first instance of a UK-regulated bank utilizing a public blockchain for retail deposits.
• The digital assets remain interest-bearing, fully backed 1:1 by pounds sterling, and covered by the Financial Services Compensation Scheme (FSCS).

Pioneering Retail Tokenization

London-based challenger bank Monument Bank is set to transition a significant portion of its retail deposits onto a public blockchain. Unlike previous industry experiments that were limited to institutional use or closed private networks, this initiative specifically targets the "mass-affluent" segment—individuals with investable assets ranging from 50,000 pounds to 5 million pounds.

With over 100,000 customers and total deposits of approximately 7 billion pounds, Monument aims to bridge the gap between traditional banking protections and the efficiency of blockchain technology. The first phase of the rollout will involve mirroring existing savings balances on the ledger.

Infrastructure and Privacy

The project is built on Midnight, a privacy-focused blockchain developed by Shielded Technologies, a firm associated with Cardano creator Input Output. This choice of infrastructure allows the bank to maintain strict data privacy; transaction details are visible only to the bank and the specific customer involved, ensuring compliance with UK regulatory standards.

Key features of the tokenized deposits include:

• Full one-for-one redeemability in sterling.
• Guaranteed coverage under the Financial Services Compensation Scheme (FSCS).
• Maintenance of interest-bearing status for all tokenized funds.

Strategic Roadmap and Institutional Reach

Following the initial phase, Monument plans to expand its digital offerings to include tokenized investment products, such as private market and commodity funds. The bank also intends to integrate lending features, allowing customers to use their tokenized holdings as collateral for loans directly within the Monument app.

Beyond its own customer base, the bank’s affiliate, Monument Technology, plans to offer this tokenization functionality as a Banking-as-a-Service (BaaS) solution. This strategic move could pave the way for other financial institutions to adopt similar blockchain-based deposit models under the same regulatory framework.