DTCC subsidiary authorized to offer tokenization service for US securities beginning 2026
The Depository Trust Company (DTC), a Depository Trust & Clearing Corporation subsidiary, has received a No-Action Letter from the U.S. Securities and Exchange Commission that clears the firm to offer a tokenization service for real-world, DTC-custodied assets.According to a Thursday notice, the new service — which DTC expects to begin rolling out in the second half of 2026 — will allow DTC participants, and indirectly their clients, to tokenize certain highly liquid assets on pre-approved blockchains under a three-year authorization period.These digital representations will carry the same entitlements, investor protection, and ownership rights as their traditional counterparts, DTCC said.SEC letter authorizes controlled tokenization of stocks, ETFs, and TreasurysUnder the No-Action Letter, DTC may tokenize a defined set of assets that includes Russell 1000 constituents, ETFs tracking major U.S. equity indices, and U.S. Treasury bills, bonds, and notes. Its tokenization service will be built on the firm’s ComposerX platform suite and is intended to create unified liquidity across traditional and digital markets, the infra provider noted.Tokens issued through the service must mirror the rights of the underlying security, and DTC will operate the environment under its established risk, resiliency, and operational standards.DTCC said the authorization allows it to launch the service "more quickly than would have otherwise been possible," while noting that onboarding details, including wallet registration and the approval process for Layer 1 and Layer 2 networks, will be provided in the coming months."This milestone enables us to help lead the transition to digital markets," DTCC President & CEO Frank La Salla said, adding that tokenization will only scale if market infrastructure maintains the same legal finality and protections of existing systems.Brian Steele, DTCC’s President of Clearing & Securities Services, said the initiative is meant to introduce digital assets "with uncompromising security" and interoperability, while leveraging the firm’s resilience built over decades.DTCC is widely regarded as Wall Street’s core post-trade utility, responsible for clearing, settling, and safeguarding an enormous portion of U.S. and global securities. Its subsidiaries process trillions of dollars in transactions annually, and DTC alone provides custody and asset servicing for securities valued at over $100 trillion, according to its 2025 figures.For decades, the firm has been the central ledger for U.S. equities, corporate bonds, municipal debt, money markets, and ETFs — effectively functioning as the back-office rails through which nearly every major brokerage and asset manager interacts.The entry into tokenization, therefore, represents a rare structural shift with implications for liquidity, collateral mobility, and market architecture.Part of a wider regulatory shift in WashingtonThe authorization arrives as U.S. regulators adopt a markedly more crypto-friendly posture under the Trump administration than during the previous Biden era.Earlier this week, the Commodity Futures Trading Commission rolled back portions of its 2020 guidance on "actual delivery" of digital assets, easing constraints on certain derivatives structures.Together, the moves highlight a policy climate more open to blockchain adoption across both exchanges and market infrastructure firms.More broadly, there have been tokenization plays from both TradFi and crypto firms that aim to bridge traditional markets and onchain access. Several companies, including JPMorgan, Coinbase, and Kraken, have announced a spate of tokenized offerings spanning equities and debt.The Wall Street back-office giant has also signaled that future iterations could include features such as stablecoin or tokenized deposit distributions, subject to further approvals, as firms race to leverage blockchain technology in the world’s largest financial market.Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.© 2025 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.