Keep pulling the thread on Tokenized Deposits.
Tokenized deposits are eligible for FDIC insurance because they are legally treated as bank deposits.
A U.S. Treasury memo projected $6.3 trillion in outflows from traditional bank deposits into stablecoins by the year 2035.
Jake predicts that through the adoption of tokenized deposits, traditional finance firms will rapidly transform into on-chain, crypto-native institutions.
Tokenized deposits are legally treated as bank deposits, which distinguishes them from stablecoins.
Jake believes tokenized deposits, rather than stablecoins, are the primary mechanism through which traditional banking will adopt on-chain assets.
Banks can pay yield on tokenized deposits in the same manner as they do on traditional bank deposits.
Matter Labs has partnered with the Carey Network to provide tokenized deposit solutions for six regional U.S. banks.
The Carey Network has a waiting list of approximately 150 banks that want to join its tokenized deposit platform.
BitGo is a heavily regulated entity that holds a federally licensed OCC charter, effectively making it a bank.
Jake asserts that large traditional finance institutions can close the technology gap with crypto-native firms by acquiring companies like Matter Labs or BitGo.
Providium is a private blockchain solution from Matter Labs designed for banks, offering full privacy and control by running on the bank's own infrastructure.
Matter Labs' Providium blockchain is secured with zero-knowledge proofs and is designed to connect to Ethereum and other institutional blockchains.