The Banks That Spent a Decade Dismissing Blockchain Are Now Building It
Jason Dussault
Chief Executive Officer, Co-Founder
This Post is disseminated on behalf of Intellistake Technologies Corp.
Two weeks ago Gregory wrote about Project Agorá, the wholesale settlement system seven central banks and forty global financial institutions are building together on tokenized rails.
The argument of that piece was that institutional finance has already decided where the next financial system is being built, and that most people missed the announcement.
Friday made the case considerably easier to defend.
JPMorgan Chase, Bank of America and Citigroup announced they are jointly building a tokenized deposit network of their own. They are calling it “the bridge” internally and expect to have it live by the first half of 2027.1
The same week, Michael Saylor sat down with CNBC’s Squawk Box and walked through the structural version of exactly why this is happening.2
Friday, the Commercial Banks Joined Them
The three banks are jointly building a shared tokenized deposit network operated by The Clearing House, the payments company they jointly own.1
Customer deposits at these banks are being represented as digital tokens on a blockchain. They will move at the speed of crypto, settle with the properties of crypto, and still be bank deposits.
That is the same architectural conclusion the central banks reached with Project Agorá. The wholesale layer was first. The commercial layer just followed.
The Reason Isn’t Optimism
It would be easy to read this as the banks finally embracing the technology.
It isn’t.
The publicly stated reason for the build is to protect their deposits from stablecoin competition.1 The Clarity Act currently moving through Congress could allow stablecoins to pay yield to consumers. If that passes, a dollar held in a tokenized stablecoin starts looking meaningfully better than a dollar sitting in a checking account.
If even a portion of customers shift, banks lose the cheap funding their entire lending business runs on.
The three biggest U.S. banks have spent the past year lobbying Washington against stablecoin yield. Now they are building a defensive version of it, in tokenized form, themselves.
The banks did not set out to build tokenized rails. They were forced into it.
Meanwhile, Saylor Was on Squawk Box
The day before the bank story broke, Michael Saylor was on CNBC explaining the same dynamic from outside the building.2
“The real power of tokenization is it creates a free market in credit formation and yield for asset owners,” he said. “
So if you can tokenize a bunch of securities, then you can shop for the best credit terms and the highest yield.”2
Saylor’s point is that the modern banking system depends on the fact that customers cannot easily move between yield and credit options. Your bank decides what you can borrow at, what you can earn on deposits, and the friction of moving keeps you put.
Tokenization removes that friction. If comparable assets can be priced against each other in real time on the same rails, the bank’s ability to set the price for its own customer collapses.
That is a much bigger claim than “tokenization speeds up settlements.” Saylor is saying tokenization restructures who gets to set the price of money.
The banks appear to have arrived at the same conclusion. They just got there from the other direction.
The Same Direction of Travel
Two weeks ago: seven central banks and forty global financial institutions, building a wholesale settlement layer on tokenized rails.
Friday: three of the biggest U.S. commercial banks, building a deposit layer on the same architecture.
Thursday: Saylor on CNBC, explaining why the entire system is being forced this way.
Each piece is news on its own. Taken together, they share the same direction of travel.
Two weeks ago Gregory wrote that the question of whether tokenized settlement was the architecture of the next financial system was no longer really open. Friday made that statement easier to defend than it already was.
What's Left to Settle
The interesting question now is not whether tokenized rails are going to underpin the financial system. That question, for anyone watching closely, has been answered.
The interesting question is what gets built on top of them. Which institutions move from prototype to production first. Which networks become addressable by AI agents. Which firms end up operating the layer in between, which is where the activity actually happens.
The central banks have a working prototype. The commercial banks are building their version now. Saylor is articulating where it leads.
The system is being rebuilt in public. The thing worth watching is who is doing the building.
Disclaimer
There has been significant volatility in digital assets and their value can decline rapidly, which in turn would lead to a decline in the stock price of companies holding digital assets. Intellistake is a start-up that does not have the same access to capital as other larger more established companies.
Intellistake has just commenced operating its business and is at an early stage of development. Intellistake is entering this space by acquiring and operating blockchain validator hardware that supports AI networks and investing in AI-related digital tokens to primarily operate validator hardware.
Intellistake is presently evaluating the regulatory framework for tokenization. Any tokenization will be subject to it being completed in compliance with applicable law, regulatory requirements and terms of any underlying agreements associated with the underlying assets. The actual structure of such tokenization, the assets that would be subject to tokenization, and the associated timeline, have not yet been determined. Intellistake will provide further updates as material developments related to this tokenization strategy occur.
Intellistake is developing custom AI software systems called "AI Agents" for businesses. It recently announced the development of IntelliScope, a newly designed enterprise artificial-intelligence (AI) suite that applies decentralized AI technologies to deliver transparent and verifiable corporate intelligence. IntelliScope, which is in testing, is being publicly introduced as Intellistake's enterprise AI suite, reflecting the Company's focus on advancing practical applications of decentralized AI technologies.
The IntelliScope suite is being developed as a collection of modular AI agents, each intended to address specific enterprise challenges. Development has advanced through internal closed testing, where functionality is being refined and validated. Built to leverage decentralized AI technologies developed within the ASI Alliance FET token ecosystem, IntelliScope is now preparing to move into closed beta testing with an enterprise client, a phase focused on gathering feedback to shape premium features and expand real-world use cases.
The Company intends to deliver these solutions either as one-time projects or ongoing subscription services. Revenue is expected to come from implementation fees and monthly subscription payments. The Company does not presently have any customers. Intellistake is just commencing operations. It is targeting significant growth but its business is subject to several risks related to general business, economic and social uncertainties; the sufficiency of cash to meet liquidity needs; legislative, political and competitive developments; the inherent risks involved in the digital currency and general securities markets; the volatility of digital currency prices and the additional risks identified in the "Risk Factors" section of the Company’s filings with applicable securities regulators. Intellistake has not yet developed or commercialized its AI solutions.
Completion of the Singularity Venture Hub (“SVH”) acquisition remains subject to completion of satisfactory due diligence, the negotiation, and execution of a definitive agreement ("Definitive Agreement") that will include representations, warranties, covenants, indemnities, termination rights, and other provisions customary for a transaction of this nature, no objection from the Canadian Securities Exchange, and shareholder approval of SVH, if required.
This report contains "forward-looking information" concerning anticipated developments and events related to the Company that may occur in the future. Forward looking information contained in this report includes, but is not limited to, all statements in respect of the Company's growth and development, the operations and business segments of the Company, support for decentralized AI and blockchain networks, the details of the collaboration with Orbit AI and its expected benefits; the Company’s contributions towards the collaboration with Orbit AI; the timelines for Orbit AI’s operation; and Intellistake’s strategy to support tokenized, decentralized AI infrastructure.
In certain cases, forward-looking information can be identified by the use of words such as "expects", "intends", "anticipates" or variations of such words and phrases or state that certain actions, events or results "may", "would", or "might" suggesting future outcomes, or other expectations, assumptions, intentions or statements about future events or performance. Forward-looking information contained in this report is based on certain assumptions regarding, among other things, the Company and SVH satisfy all conditions necessary to close the proposed transaction; the Company will continue to have access to financing until it achieves profitability; obtaining the necessary regulatory approvals; the technology and blockchain industries in which the Company intends to focus its business in will grow at the rate and in the manner expected; the ability to attract qualified personnel; the success of market initiatives and the ability to grow brand awareness; the ability to distribute Company's services; the Company creates strategies to mitigate risks associated with cryptocurrency price fluctuations; the Company and SVH remain compliant with all applicable laws and securities regulations and applicable licensing requirements; the Company engages and collaborates with local experts, as necessary, to address jurisdiction-specific matters and ensures compliance with foreign regulations to avoid penalties; the Company addresses any potential cybersecurity threats promptly and effectively; the ability of the Company to develop its technology, acquire customers and have revenue; the ability to successfully deploy the new business strategy as a result of the change of business. While the Company considers these assumptions to be reasonable, they may be incorrect.
Forward looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results to be materially different from any future results expressed by the forward-looking information. Such factors include risks related to general business, economic and social uncertainties; failure of the Company and SVH to satisfy all conditions necessary to close the proposed transaction; failure to raise the capital necessary to fund its operations; inability to create strategies to mitigate the risks associated with cryptocurrency price fluctuations; the costs of regulation in the digital asset industries increase to the extent that the Company is no longer generating sufficient returns for shareholders; failure to promptly and effectively address cybersecurity threats; insufficient resources to maintain its operations on a competitive basis; and the actual costs, timing and future plans differs expectations; legislative, environmental and other judicial, regulatory, political and competitive developments; the inherent risks involved in the cryptocurrency and general securities markets; the Company may not be able to profitably liquidate its current digital currency inventory, or at all; a decline in digital currency prices may have a significant negative impact on the Company's operations; the Company's success may depend on the continued involvement of key personnel, including advisors, whose involvement cannot be guaranteed; institutional adoption of decentralized AI infrastructure remains uncertain and may not occur at the pace or scale anticipated; evolving regulatory frameworks, including those related to AI (such as Canada's proposed Artificial Intelligence and Data Act), may impose additional compliance burdens or restrict certain business activities; valuation figures are based on publicly available market data and internal assessments at the time of the referenced transactions and may not reflect current or future valuations; the volatility of digital currency prices; the inherent uncertainty of cost estimates and the potential for unexpected costs and expenses, currency fluctuations; regulatory restrictions, liability, competition, loss of key employees and other related risks and uncertainties; delay or failure to receive regulatory approvals; failure to attract qualified personnel, labour disputes; and the additional risks identified in the "Risk Factors" section of the Company's filings with applicable Canadian securities regulators.
Although the Company has attempted to identify factors that could cause actual results to differ materially from those described in forward-looking information, there may be other factors that cause results not to be as anticipated. Readers should not place undue reliance on forward-looking information. The forward-looking information is made as of the date of this report. Except as required by applicable securities laws, the Company does not undertake any obligation to publicly update forward-looking information.
