The Depository Trust & Clearing Corporation (DTCC) is making a big move into tokenization.
Currently, DTCC is a vital part of the securities trading and tracking ecosystem. In 2024, DTCC’s subsidiaries processed securities transactions valued at US$3.7 quadrillion, and its depository subsidiary provided custody and asset servicing for securities issues from over 150 countries and territories valued at US$99 trillion. With the advent of distributed ledgers and tokenization, DTCC’s world is about to change, but the company is doing something about it.
In what is described as a major milestone to support digital asset adoption, DTCC subsidiary, The Depository Trust Company (DTC) has received a No Action Letter from the Securities and Exchange Commission.
The Letter allows DTC to offer a new service to tokenize real-world assets in a controlled production environment. DTC will roll out the service in the second half of 2026.
The No-Action Letter authorizes DTC to offer a tokenization service for DTC Participants and their clients on pre-approved blockchains. Under the Letter, the tokenized assets will hold all the same entitlements, investor protections, and ownership rights as the asset in its traditional form.
The authorization applies to a defined set of highly liquid assets, including the Russell 1000, as well as ETFs tracking major indices and U.S. Treasury bills, bonds, and notes.
The No-Action Letter is significant because it allows DTC to launch the service once finalized, subject to certain limitations and representations, more quickly than would otherwise be possible.
Frank La Salla, President & CEO, DTCC, thanked the SEC for placing its trust in their service.
“Tokenizing the U.S. securities market has the potential to yield transformational benefits such as collateral mobility, new trading modalities, 24/7 access and programmable assets, but this will only be achievable if market infrastructure provides a robust foundation to usher in this new digital era. We welcome this opportunity to further enable and innovate for the industry, our participants and their clients. We look forward to partnering across the industry to tokenize real-world assets safely and securely while advancing the future of finance for generations to come.”
DTCC’s tokenization approach is expected to enable DTC Participants and their clients to take advantage of a comprehensive tokenization service. DTC aims to create a single pool of liquidity across the TradFi and DeFi ecosystems and deliver a more resilient, inclusive, cost-effective and efficient financial system.
“Distributed Ledger Technology (DLT) has the power to reshape markets, and DTCC is championing this transformation through innovative actions and bold solutions,” said Nadine Chakar, Managing Director and Head of Digital Assets at DTCC. “Our suite of DLT offerings will underpin DTCC’s tokenization service and, together with the industry, will drive development of a new digital asset ecosystem for all.”