Context and Chronology

Cari Network — a consortium formed by regional banks and industry participants — has chosen Matter Labs’ Prividium stack running on ZKsync to pilot a permissioned, bank‑governed tokenised deposit network. The architecture is explicitly designed so deposits remain booked on each participant’s balance sheet as insured bank liabilities while tokenised representations can move between verified accounts at any hour. Design and early trials involved five regional institutions and focused on separating transaction metadata on the ledger from customer‑identifying records held in banks’ core systems, producing tamper‑evident audit trails and controlled examiner access.

Technically, the implementation leans on ZKsync’s L2 primitives and Prividium’s privacy and permissioning features to deliver instant settlement between verified counterparties while retaining bank control over compliance, reserve placement and credit risk. The selection follows a notable contraction in ZKsync’s public activity (onchain transactions declined ≈90% in 2025), which the ZKsync team says prompted a strategic pivot toward deterministic control, enterprise privacy primitives and richer interoperability features to meet regulated institutions’ needs.

Governance and compliance are central design constraints: the network will constrain token circulation to KYC‑verified participants, integrate identity and AML tooling into settlement flows, and preserve on‑shore custody and supervisory visibility. Participating banks contributed product and compliance expertise to shape permissioned ledger architectures and token standards that map directly to insured deposit claims. The consortium has emphasised regulator engagement and the need to demonstrate reserve placement, insolvency sequencing and legal equivalence so tokens do not create counterparty ambiguity.

Broader industry drivers and risks frame the pilot. Banks present tokenised deposits as a defensive strategy to retain deposit funding and fee pools that might otherwise migrate to non‑bank stablecoins or platform‑led rails. But multiple practical bottlenecks persist: uneven legal clarity across jurisdictions about the on‑chain status of money; the need to digitise and embed identity/compliance tooling to match sub‑second settlement finality; and remaining performance and ordering guarantees (throughput, latency, miner/MEV risks) that matter for high‑volume clearing and custody use cases.

If pilots validate legal equivalence, reserve visibility and automated compliance, banks could shorten settlement windows, offer programmable deposit features (conditional transfers, instant cross‑bank movement) and provide custody‑integrated products to institutional clients. Conversely, failure to resolve legal or infrastructure gaps could steer flows toward platform‑led rails or privately issued settlement assets, increasing concentration and interoperability frictions.

The Cari/Prividium deployment typifies a current pattern: repurposing public L2 primitives for constrained, compliance‑first rails that trade open DeFi composability for supervisory control and audibility. That trade‑off concentrates value with middleware vendors capable of delivering privacy and deterministic governance while creating potential vendor lock‑in and cross‑platform liquidity challenges. Regulators face a policy trade‑off too — tightly channeling issuance through banks can curb deposit flight but risks pushing innovation offshore or into lighter‑touch rails.

Next steps for the consortium include phased pilots, continued coordination with supervisors, further standardisation work around on/off ramps and reserve mechanics, and testing operational sequencing for insolvency scenarios. The pilot’s outcome will help determine whether bank‑issued token rails capture short‑term deposit flows from non‑bank stablecoins for core merchant and business channels, or whether hybrid and private rails continue to siphon liquidity into parallel settlement systems.