Wall Street backbone DTCC brings $30 trillion securities closer to blockchain with major banks

The Depository Trust & Clearing Corporation (DTCC), the giant at the heart of U.S. securities markets, went live with its tokenization service Wednesday, taking a step toward bringing stocks, bonds and funds onto blockchain infrastructure.

The service is available on the Canton Network CC$0.09729 and DTCC's private Besu blockchain, initially supporting select large-cap stocks from the Russell 1000 index, exchange-traded funds (ETF) and U.S. Treasury bills, notes and bonds. DTCC’s product website says 34 securities are eligible at launch, which represent approximately $30 trillion market value, a DTCC spokesperson told CoinDesk.

The debut is a significant step for Wall Street's tokenization push because DTCC sits at the center of how U.S. securities markets work. Through its subsidiaries, the firm handles clearing, settlement and custody for much of the country's stock and bond trading, with more than $114 trillion in securities held at its depository.

The company’s road map includes adding Stellar XLM$0.1690 and stablecoin issuer Circle Internet's Arc blockchain next year, along with broader corporate-action support and tools for settling transactions with digital cash.

The tokens are backed one-for-one by securities held at DTCC subsidiary Depository Trust Company (DTC), and can move between registered wallets around the clock.

Bringing blockchain technology into the system could make tokenized assets part of mainstream market infrastructure rather than a separate market operating alongside it.

Tokenization promises to make financial assets easier to transfer, settle and use as collateral. While banks and asset managers have spent years experimenting with blockchain-based securities, connecting those assets to the systems that already underpin trillions of dollars in transactions could help bring the technology into everyday market operations.

Analysts at Citi projected tokenized securities will become a $5.5 trillion market by 2030 as more financial institutions adopt blockchain technology.

Bringing traditional securities onchain

"Today marks the culmination of years of work to bring tokenized securities into a regulated framework supported by trusted market infrastructure," said Frank La Salla, DTCC's president and CEO.

"By extending DTC's resiliency, governance and operational standards into digital markets, we are establishing the foundation for responsible institutional adoption at scale."

Twenty participants have signed agreements to access the service, including Bank of America, Barclays, Citi, Fidelity Investments, JPMorgan, Morgan Stanley, Citadel Securities, State Street and UBS. DTCC said more firms will join over time.

Eligible firms can convert securities into tokens during business hours, with DTCC targeting processing times of 15 minutes or less. Once tokenized, the assets can move between registered blockchain wallets around the clock, subject to compliance restrictions.

The service keeps official ownership records with DTC even as tokens move between registered wallets. That structure sets the approach apart from synthetic stock tokens that track share prices without granting ownership of the underlying securities. DTCC's tokens represent securities already held in custody, preserving their existing rights.

The rollout follows a demonstration earlier this year and plans announced in May.

Wall Street's tokenization push

In addition to adding Stellar and Arc in 2027, DTCC plans to add tools for settling transactions with digital cash and using tokenized securities as collateral.

The service builds on a December no-action letter by the U.S. Securities and Exchange Commission, which allowed DTCC to tokenize a defined set of securities.

Other market operators are moving in the same direction. Nasdaq and the New York Stock Exchange (NYSE) are developing tokenized securities trading infrastructure, while NYSE parent Intercontinental Exchange (ICE) is set to operate a blockchain-based trading venue under the SEC’s innovation exemption with crypto exchange OKX.