The Depository Trust & Clearing Corporation launched its DTC Tokenization Service for commercial use in October 2026, opening approximately $30 trillion in eligible assets to on-chain representation across two blockchain networks. The service covers 25 securities drawn from Russell 1000 equities,...
"DTCC demonstrated that we can apply the same institutional rigor to tokenization as we do for traditional assets while continuing to safeguard the integrity and resiliency of the global financial markets." — Frank La Salla, President and CEO, DTCC
The Depository Trust & Clearing Corporation launched its DTC Tokenization Service for commercial use in October 2026, opening approximately $30 trillion in eligible assets to on-chain representation across two blockchain networks. The service covers 25 securities drawn from Russell 1000 equities, major index ETFs, and U.S. Treasury instruments — each tokenized as a 1:1 "digital twin" of securities already held in DTC custody.
The launch follows a July 15 production test involving more than 30 firms across seven settlement workflows, including collateral pledge, securities lending, delivery-versus-payment, and CCP margin operations. An Industry Working Group of 50-plus institutions — spanning BlackRock, JPMorgan, Goldman Sachs, Nasdaq, Circle, and Ondo Finance — participated in the design phase. The regulatory foundation was established on December 11, 2025, when the SEC's Division of Trading and Markets issued a three-year no-action letter authorizing DTC to offer the service.
This is not a pilot. It is the first time the central clearing infrastructure for U.S. securities markets has offered production tokenization to its participants, with real assets, real settlement, and existing investor protections intact.
On December 11, 2025, the SEC's Division of Trading and Markets issued a no-action letter to the Depository Trust Company — the DTCC subsidiary that holds custody over approximately $114 trillion in U.S. securities. The letter authorized DTC to operate a tokenization service for a defined, three-year period.
The authorization scope is specific. DTC may tokenize: Russell 1000 constituents (the 1,000 largest U.S. public companies by market capitalization), ETFs tracking major U.S. equity indices, and U.S. Treasury bills, bonds, and notes. Combined, these categories represent approximately $30 trillion in eligible assets.
The relief permits DTC participants to elect to have their security entitlements recorded using distributed ledger technology rather than exclusively through DTC's centralized ledger. According to legal analysis from Morgan Lewis, the letter establishes that tokenized representations maintain identical rights and investor protections as their underlying securities. Tokens retain their existing CUSIPs, which means existing market infrastructure — trade reporting, tax lot tracking, corporate actions — continues to function.
The no-action structure means the SEC has not approved tokenization as a permanent feature of market infrastructure. It has allowed a supervised three-year window to demonstrate whether the technology can operate at institutional scale without compromising market integrity.
The DTC Tokenization Service creates 1:1 tokenized representations — referred to as "digital twins" — of securities already custodied at DTC. This is a critical design choice: no new securities are created. Each token maps directly to an existing position in DTC's book-entry system.
At launch, 25 securities are eligible for tokenization. These were selected from the Russell 1000, major ETFs, and U.S. Treasury instruments based on liquidity and market demand. The initial set is deliberately narrow. DTCC has indicated expansion will follow based on participant adoption and operational performance.
The architecture preserves existing clearing and settlement workflows. Trades in tokenized securities still clear through the National Securities Clearing Corporation (NSCC) and settle through DTC. What changes is the post-settlement layer: once a security is settled in DTC's traditional system, a participant can convert their position into a token on a supported blockchain. The underlying security never leaves DTC custody.
DTCC selected two blockchain networks for the October launch:
Canton Network — Built by Digital Asset Holdings using the Daml smart contract language, Canton is a privacy-focused network designed for institutional use. Tokens on Canton use the CIP-56 token standard. Canton functions as the public-network option within the DTCC framework, though "public" here means permissioned access for vetted institutional participants, not open access.
Hyperledger Besu (Private) — DTCC operates its own private Besu network where tokens use the ERC-20 standard. All validator nodes are controlled by DTCC. This is a permissioned environment where only allowlisted participants can operate.
The dual-chain approach reflects a practical reality: different institutional participants have different technology stacks and risk tolerances. Some firms already operate on Canton through existing Digital Asset integrations. Others prefer the EVM-compatible environment of Besu. Rather than forcing a single standard, DTCC is meeting participants where they are.
A notable limitation at launch: tokens on Canton cannot be transferred to Besu, and vice versa. Cross-chain interoperability is not available in the initial release. DTCC has indicated this is on the development roadmap but has not committed to a timeline.
On July 15, 2026, DTCC executed its first production trades using DTC-tokenized assets. More than 30 firms participated across both the Canton and Besu networks over a period of several hours. DTCC described it as the largest tokenization production initiative in terms of breadth of use cases, asset classes, and number of participants.
Seven distinct workflows were tested:
The collateral and margin workflows are particularly significant. Real-time collateral mobility — the ability to pledge, recall, and substitute collateral in minutes rather than overnight — addresses a longstanding inefficiency in securities markets. According to Brian Steele, President of Clearing & Securities Services at DTCC, the production trades "showcased how tokenization can enable real-time collateral mobility, enhance liquidity and capital efficiency, reduce counterparty risk and support interoperability between traditional and digital ecosystems."
DTCC has not disclosed specific transaction volumes or dollar amounts from the July 15 test. What is known: the test ran successfully across all seven workflow types, and no material operational issues were reported.
The DTCC Industry Working Group that shaped the service's design includes more than 50 firms. The composition is notable for its breadth, spanning traditional Wall Street institutions, crypto-native infrastructure providers, and technology companies:
Major Banks and Asset Managers: BlackRock, JPMorgan, Goldman Sachs, Citi, Bank of America, Morgan Stanley, BNP Paribas, Société Générale, HSBC, Lloyds Bank, State Street, Vanguard, Invesco, Franklin Templeton, Charles Schwab, Raymond James, RBC
Exchanges and Trading Venues: Nasdaq, NYSE Group, Tradeweb, Citadel Securities, CME Group, Virtu Financial, Flow Traders, DRW
Crypto and Digital Asset Firms: Circle, Ondo Finance, Fireblocks, BitGo Bank & Trust, Ripple Prime, Chainlink, Robinhood Markets, Alpaca, Prometheum Capital, Kraken (via parent Payward)
Technology and Infrastructure: Digital Asset Holdings, Broadridge, Microsoft, FIS, Kaleido, BetaNXT, Talos, Linux Foundation Decentralized Trust
The inclusion of both Circle (stablecoin issuer) and Ondo Finance (tokenized treasury fund issuer) alongside traditional broker-dealers and custodians signals that DTCC is positioning the service as infrastructure that bridges existing tokenization efforts with the regulated securities settlement layer. These firms already issue their own tokenized products; the DTC service offers them a path to interoperate within the established clearing system.
Conversion Window: DTC participants submit conversion orders — requests to tokenize or de-tokenize securities positions — through a UI or API interface. Orders are accepted between 2:00 a.m. and 6:00 p.m. Eastern Time on business days. DTCC targets processing within 15 minutes or less.
24/7 Transfers: Once tokenized, securities can be transferred peer-to-peer between registered wallets on the same blockchain at any time, including nights, weekends, and holidays. This is a meaningful operational improvement over the current T+1 settlement cycle, which restricts transfers to business hours.
Custody Model: The underlying securities never leave DTC custody. Tokenization creates a representation layer on top of the existing book-entry system. If a participant de-tokenizes, their position reverts to the traditional ledger. This dual-record approach means the service adds optionality without requiring participants to abandon existing infrastructure.
Investor Protections: Tokenized positions retain all rights of the underlying security: voting rights, dividend entitlements, corporate action participation, and regulatory protections. The securities remain registered in DTC's nominee name (Cede & Co.), consistent with the existing street-name registration system.
DTCC has outlined several expansion vectors for 2027:
Additional Blockchain Networks: Stellar (using the SEP-41 token standard) and Circle's Arc network (using ERC-20) are expected to be added in 2027. Additional layer-one and layer-two networks will be evaluated based on client demand and technical readiness.
Expanded Securities Universe: Beyond the initial 25 securities, DTCC plans to progressively increase the number of eligible instruments. The full Russell 1000, broader ETF coverage, and additional Treasury maturities are expected in the expansion phases.
Cross-Chain Functionality: Interoperability between Canton and Besu — and eventually across additional supported networks — is on the development roadmap. The technical approach has not been disclosed.
Fee Structure: DTCC has not published tokenization-specific pricing as of the October launch. The fee model will be a critical factor in adoption rates. If tokenization fees are additive to existing DTC custody fees, the economic case for participants weakens. If they replace or reduce existing fees, adoption could accelerate.
The DTCC Tokenization Service represents a notable data point in the broader question of where economic value accrues in blockchain-based financial infrastructure.
Value capture remains centralized. DTC operates as the sole tokenization provider for the securities it holds in custody. The service extends DTC's existing monopoly position in U.S. securities settlement into the tokenization layer. Participants must use DTC's approved blockchains, DTC's conversion process, and DTC's custody model. The blockchain networks (Canton, Besu) function as infrastructure layers, but the gatekeeping and value capture sit with the central depository.
The blockchain layer is permissioned, not public. Neither Canton nor DTCC's private Besu network is open to arbitrary participation. Validators on Besu are DTC-controlled. Canton access requires institutional vetting. This constrains the composability and permissionless innovation that characterize public blockchain ecosystems. The tradeoff is regulatory compliance and operational control.
Collateral efficiency is the immediate economic driver. The ability to pledge, recall, and substitute collateral in near-real-time — rather than on a T+1 or overnight cycle — unlocks quantifiable capital savings. According to industry estimates, the global securities lending market involves approximately $2.6 trillion in outstanding loans. Even marginal improvements in collateral velocity translate to meaningful reductions in capital buffers and financing costs.
Token holder rights are derivative, not native. Unlike crypto-native tokens where the token is the asset, DTC-tokenized securities are representations of positions in a centralized ledger. The token confers no additional rights beyond what the underlying book-entry position already provides. This is by design — it maintains regulatory compliance — but it also means the "token" is essentially a pointer to a database entry, not an independent bearer instrument.
The DTC Tokenization Service launched commercially in October 2026 with 25 securities covering approximately $30 trillion in eligible assets, backed by a three-year SEC no-action letter issued December 11, 2025.
Production trades on July 15, 2026 tested seven settlement workflows across 30+ firms on Canton and Besu networks, with no reported material failures.
50+ firms — including BlackRock, JPMorgan, Goldman Sachs, Circle, and Ondo Finance — participated in service design, spanning TradFi, crypto infrastructure, and technology sectors.
Tokenized securities retain existing CUSIPs, investor protections, and settlement mechanics. The underlying assets remain in DTC custody. The blockchain layer adds a representation and transfer capability, not a new asset class.
Cross-chain interoperability between Canton and Besu is not available at launch. Stellar and Arc network support is planned for 2027.
Collateral mobility — the ability to pledge and substitute collateral in near-real-time — is the primary economic value proposition for institutional participants.
DTCC has not disclosed the fee model. Pricing will materially affect adoption rates.
The DTCC Tokenization Service is the first instance of a systemically important financial market infrastructure offering production tokenization of regulated securities. It is not the first tokenization effort — firms like Franklin Templeton, BlackRock, and Ondo Finance have been issuing tokenized fund products for over a year. But it is the first to operate within the existing U.S. clearing and settlement plumbing, with SEC authorization and participation from more than 50 firms.
The service is deliberately conservative in scope. Twenty-five securities, two permissioned blockchains, no cross-chain transfers, business-hours-only conversion windows. This is infrastructure, not experimentation.
The open questions are material. Will DTCC's fee model incentivize or discourage adoption? Will cross-chain interoperability arrive in time to prevent fragmentation? Will the three-year no-action window be extended or replaced with permanent rulemaking? And will the efficiency gains in collateral mobility — the clearest economic value driver — prove large enough to justify the integration costs for participants?
The data from the July production test suggests the technology works. Whether the economics work is the next question to answer.