Deposit Token Race Heats Up, Germany Nears Launch

Germany's deposit token project advances with sandbox tests and new bridge architecture as regulatory hurdles remain

  • Germany‘s CBMT deposit token initiative is advancing to production, with a live Sandbox and five banks targeted for launch.
  • The project has shifted from a shared ledger model to a “CBMT Bridge” architecture, connecting separate bank systems to multiple industry DLTs.
  • BaFin has classified CBMT as a deposit, but final European regulatory approval remains a key hurdle.

A consortium of major German banks is moving toward launching a live deposit token network, with pre-production trials now underway in a dedicated sandbox environment. The Commercial Bank Money Token (CBMT) project aims for five banks to go live at launch, supported by technical partners and involving large corporations like Siemens and Evonik.

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However, European regulatory clarity remains the final significant obstacle. While Germany’s BaFin regulator classified the token as a deposit, European-level confirmation is still pending. Consequently, this creates a situation where stablecoins ironically may have clearer EU rules than commercial bank deposits using similar technology.

Meanwhile, the project’s technical architecture has evolved considerably since early proof-of-concept work. Instead of a single shared bank ledger, it now employs a CBMT Bridge for interoperability. This approach connects various banks’ existing tokenized systems to multiple industry distributed ledgers.

Consequently, participating institutions can leverage prior investments in standalone solutions. This architectural shift also sidesteps the difficult choice of mandating one specific blockchain technology. Banks and industry networks are now free to make their own underlying technology selections.

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