The Depository Trust & Clearing Corporation (DTCC) has partnered with Digital Asset to tokenize U.S. securities using the Canton Network, a privacy-oriented blockchain, in a move announced on December 17, 2025.
DTCC’s choice reflects institutional priorities: confidentiality, compliance and interoperability. Canton Network offers protocol-level programmable privacy, which lets participants restrict data visibility to authorized parties while preserving the cryptographic record required for settlement and reconciliation. Programmable privacy here means configurable controls at the protocol layer that selectively hide transaction details from non-authorized observers.
These capabilities align with DTCC’s role as a regulated market infrastructure provider and with the specific confidentiality needs of sovereign debt instruments. The ledger design emphasizes auditability and regulator access without compromising counterparty confidentiality, aiming to balance operational efficiency with strict privacy requirements.
The decision follows regulatory clearance via a three-year SEC no-action letter for a pilot of tokenization services and signals an institutional push toward 24/7 trading, improved collateral mobility, and post-trade modernization using Canton Network.
Why DTCC selected the Canton Network
DTCC obtained a three-year pilot authorization via a no-action letter from the U.S. Securities and Exchange Commission, permitting DTC to test a tokenization service under supervised conditions. A no-action letter is a regulatory notice that indicates the agency will not recommend enforcement action under specified pilot parameters.
DTCC plans a phased implementation. The initial minimum viable product (MVP), slated for the first half of 2026, will cover Russell 1000 equities and ETFs. U.S. Treasuries held in DTC custody are scheduled for subsequent integration following pilot validation. Near-term pilots will engage banks, asset managers and custodians to validate technical integrations, operational workflows and compliance controls within controlled environments.
Expected near-term benefits include increased collateral mobility and extended trading windows. Anticipated operational challenges include integrating diverse legacy systems, aligning varied participant operational models and ensuring systemic cybersecurity at scale.
If the pilot proves operationally sound and gains market traction, tokenization on Canton Network could reshape post-trade plumbing by enabling faster settlement and more efficient collateral reuse. Long-term goals include establishing interoperable, liquid markets for tokenized assets and enabling atomic settlement across counterparties.
