DTCC Picks Canton Network for Treasury Tokenization Push
The Wall Street clearing giant will mint some US Treasury securities on Canton's privacy-focused blockchain.
Quick overview
- DTCC has partnered with Canton Network to tokenize US Treasury securities on a privacy-focused blockchain, marking a significant step for institutional adoption.
- The SEC's no-action letter allows DTCC to tokenize real-world assets, providing the regulatory clearance needed to proceed with their plans.
- Canton's permissioned structure addresses confidentiality concerns in institutional finance, enabling secure transactions while maintaining privacy.
- If successful, DTCC's pilot program could accelerate the adoption of tokenized settlement systems, potentially transforming current trading and settlement processes.
DTCC went with Canton Network Tuesday for its tokenization plans. The Wall Street clearing giant will mint some US Treasury securities on Canton’s privacy-focused blockchain, marking a huge step for institutional adoption.
This comes right after the SEC gave DTCC a no-action letter letting them tokenize real-world assets that DTC holds in custody. That regulatory clearance was the green light DTCC needed to actually move forward.
DTCC’s also joining the Canton Foundation as co-chair alongside Euroclear. Two massive market infrastructure players steering a blockchain network together sends a signal about where traditional finance thinks this tech is headed.
Yuval Rooz from Digital Asset, which built Canton, said DTCC’s involvement “accelerates industry adoption” and creates a base for new liquidity products and operational improvements. Standard corporate speak, but coming from the entity that processes over $2 quadrillion in securities annually, it carries weight.
Canton’s pitch is privacy. Most public blockchains expose transaction data to everyone. That’s a nonstarter for institutional finance where confidentiality matters for competitive and regulatory reasons. Canton solves this with a permissioned structure where participants control who sees what.
The network already ran multiple pilots with DTCC. Last one involved 26 organizations doing 100-plus transactions using tokenized Treasury bonds. They tested creating digital twins of real assets, using them as collateral for margin calls, recalling assets, and handling closeout scenarios. Everything worked.
What makes Canton interesting is the interoperability angle. It connects multiple sovereign blockchains while keeping them separate. So JPMorgan can run its own chain, Goldman runs theirs, but they can still transact atomically across chains when needed. Privacy stays intact but you get the network effects.
DTCC’s no-action letter runs for three years, basically a pilot program at scale. They can mint tokenized versions of select equities, ETFs, and government Treasuries on approved blockchains. The pilot kicks off second half of 2026.
There’s a failsafe structure built in. DTC controls a root wallet that can reverse transactions if something goes wrong. That addresses the “what if there’s a mistake” concern that keeps compliance teams up at night. Blockchain purists hate that kind of centralized control, but institutional finance demands it.
The timing matters. Markets have spent years talking about tokenization without much happening in regulated US markets. Now with the SEC backing off its aggressive enforcement stance and actually permitting experimentation, infrastructure players like DTCC are making moves.
Other players are watching closely. If DTCC successfully demonstrates that tokenized settlement works at scale without breaking anything, expect a rush of similar initiatives. The opposite is also true. If this pilot hits technical or regulatory problems, it could slow everything down.
Settlement times are the big prize here. Current T+1 settlement means trades clear the next business day. Tokenized systems could theoretically settle in minutes or seconds. That frees up capital, reduces counterparty risk, and opens 24/7 trading possibilities.
Canton already proved the weekend trading concept. Earlier this year, participants executed real-time on-chain repo transactions using tokenized Treasuries and USDC on a Saturday. That’s impossible in traditional markets where settlement infrastructure shuts down outside business hours.
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