Sibos 2026: Temenos' Mick Fennell on Tokenisation 3.0 and the Rise of "TradTok" Banking

Quick Summary

"The future of banking is tokenised, or at least a significant proportion of the future of banking is tokenised," says Mick Fennell of Temenos. Speaking at Sibos 2026, he breaks down the four types of digital money, explains why tokenised deposits are starting to move the needle, and sets out why the future is multi-currency, multi-rail and multi-chain, with banks as the interoperable bridge between traditional and tokenised finance.

Which banks are being affected by digital money?

It depends on geography and line of business. Global Tier 1 banks are already offering services, but Fennell is now seeing a trickle-down effect into the other tiers, for example using stablecoins for cross-border payments, treasury and settlement. Another big push is the digital euro, the largest central bank digital currency being introduced. Frontrunners and pilot organisations are now working out what they need to implement it, and Fennell expects that to drive a lot of change in the eurozone over the next six months to two years.

What are the four types of digital money?

• Public money: CBDCs
• Private money: stablecoins, created by private groups to move value
• Bank money: tokenised deposits, where the bank tokenises its customers' deposits
• Crypto: with no collateral behind it, more about trading

Banks are focusing on the first three, and tokenised deposits are the one really starting to move the needle, because they stay within current regulatory frameworks and let banks tokenise the dollars, euros or pounds already in customers' accounts. Banks will also have to decide which currencies they support, acting as the gatekeeper for their customers.

Is the infrastructure ready?

Not yet. Fennell says there is very little infrastructure in the world to process tokenised deposits, but new networks are appearing: in the US, in the UK, and on Swift's ledger, where the proof of concept has centred on banks tokenising deposits and using them on a blockchain.

What is tokenisation 3.0?

• Tokenisation 1.0 (2010 to 2017): the invention of blockchain and Bitcoin, and the realisation the technology could be used for other things
• Tokenisation 2.0: digital wallet providers and exchanges arrived, and regulators started putting guardrails in place
• Tokenisation 3.0: with those guardrails in place, traditional banks are looking at where they can play, from payments to tokenised trade finance, letters of credit, guarantees and lending

What does an interoperable future look like?

A payment order might arrive in fiat and be settled in a tokenised deposit, a stablecoin or a CBDC, so interoperability has to be seamless and real-time, with the same guardrails customers get on fiat. Fennell describes the customer's digital wallet as a "digital bucket" holding fiat, tokenised deposits, stablecoins, CBDCs and ID information, with the bank as the gateway. Temenos is building API-first, cloud-native, event-driven platforms for this, as payment volumes grow by around 10% a year globally and upwards of 15% in some markets. He calls the result "TradTok banking": traditional and tokenised together.

What will tokenisation deliver for customers?

Fennell links tokenisation to the G20's goals for payments on cost, access, speed and transparency, with a first target in 2028. Over the next three to five years, he expects tokenisation to become relatively normalised, giving customers more ways to pay, more liquidity and faster, more transparent outcomes.

FF NEWS TAKE:

"TradTok" is a phrase that will either stick or make people wince, but the idea behind it is right. Banks won't get to choose between fiat and tokenised rails; their customers will hold both. Fennell's breakdown of the four forms of digital money is one of the clearest we've heard, and his view that tokenised deposits, not stablecoins, are where banks are really moving fits what we heard across Sibos this year.