Technology is reshaping the financial system, driving a shift towards an “always on” 24/7 market infrastructure and real-time transactions. This evolution is transforming money into a more digital, programmable, and perpetually active asset class.
Addressing this shift, Deutsche Bank has produced a new whitepaper on the digital money landscape. This paper addresses the three main types of digital money that are experiencing increased uptake, namely stablecoins, tokenized deposits, and central bank digital currencies (CBDCs), exploring the regulatory and market forces shaping them, and how these changes are impacting the industry.
Stablecoins
Stablecoins are blockchain-based tokens issued by banks, corporates or fintech startups, typically backed one-for-one by a fiat currency. They are designed to maintain price stability by holding collateral reserves to support their value, with transparency achieved through regular disclosure of these reserves.
Driven by the implementation of comprehensive regulatory frameworks for stablecoin issuance and transfers across key global regions, in particular the European Union (EU) and the US, stablecoins have generated significant interest from the payments industry, and now represent one of the most advanced forms of digital private money.
In 2025, overall stablecoin transaction volume was estimated at US$62 trillion, according to the Boston Consulting Group (BCG). While real-economy payments still accounted for only a small share of activity at about 7% in 2025, they grew rapidly at about 55% year-over-year (YoY), with the strongest expansion in business-to-business (B2B) transactions.
Tokenized deposits
Another prominent type of digital money is tokenized deposits. These have emerged as a promising model for enabling programmable bank money across payments, treasury operations and wholesale settlement.
Currently, tokenized deposit platforms are most commonly used to transfer liquidity between accounts held across different branches within the same financial institution. In these setups, banks operate proprietary blockchain networks that enable 24/7 settlement across branches by representing deposits from corporate clients or other banks as tokens on an internal ledger.
Another model involves industry collaborations that provide shared ledger infrastructure across multiple institutions. These platforms aim to enable coordinated movement of tokenized deposits across banks while preserving the governance and controls expected in regulated financial networks.
Notable examples include:
- Partior, which supports real-time cross-border settlement of tokenized deposits, utilizing pre-validation and atomic settlement to reduce breaks and investigations; and
- Project Agora, by the Bank for International Settlements (BIS) in collaboration with seven central banks and a large group of private sector companies under the Institute of International Finance (IFF), which is designing a unified ledger where tokenized deposits interoperate with wholesale CBDC for policy aware, atomic cross-border settlement.
As a form of private digital money, tokenized deposits are often viewed as a payment instrument competitive against stablecoins, promising many of the purported efficiency gains that stablecoins can provide for payments, including increased speed, transparency, and potentially lower costs.
However, they face challenges surrounding interoperability and integration with existing banking systems. To date, most tokenized deposit implementations have relied on private, permissioned blockchains accessible only to issuing banks or authorized institutions. This means that tokenized deposits can only be held by clients of an issuing bank. In contrast, stablecoins can be held practically by anyone who has a wallet that can hold the stablecoins, including users without a direct relationship with the stablecoin issuer.
CBDCs
Finally, the final pillar highlighted in the whitepaper is CBDCs. CBDCs are digital forms are central bank-issued money that can designed either for use by the general public as a retail CBDC, or for use between financial institutions as a wholesale CBDC.
Retail CBDCs aim to act as a digital complement to cash, providing access to central bank money in electronic form for everyday payments. China offers the most advanced large-scale example of a retail CBDC with the e-CNY ecosystem. In September 2025, e-CNY reached cumulative transaction volumes of CNY 14 trillion (US$2 trillion), an expansion that had been supported by an established network of hardware wallets, enhanced offline payment capabilities, and ongoing cross-border pilot initiatives.
In the EU, the European Central Bank is advancing its initiative to introduce a digital euro, aimed at complementing physical cash and facilitate a broad range of payment activities including point-of-sale (POS), e-commerce and peer-to-peer (P2P) transactions. Subject to legislative approval, pilot testing of the digital euro could begin as early as H2 2027, with a potential launch in 2029.
In contrast to retail CBDCs, wholesale CBDCs are designed for use between institutions, enabling the settlement of interbank payments and securities transactions. These models are gaining traction as central banks focus on modernizing financial market infrastructure and enhancing the efficiency of interbank settlement.
In Asia, Hong Kong and Singapore are actively advancing wholesale CBDC initiatives and cross-border experiments. Hong Kong is focused on developing settlement infrastructure for tokenized deposits, while Singapore is conducting broader distributed ledger technology (DLT)-based settlement trials for capital markets.
Singapore has also established partnerships with multiple central banks, including France and Switzerland, to test the cross-border trading and settlement of wholesale CBDCs between financial institutions.
Featured image: Edited by Fintech News Switzerland, based on image by freepik via Magnific
