BNY and Citadel Securities have completed a milestone transaction using a tokenized 2-year U.S. Treasury note on a major triparty repo platform. Citadel purchased the note on Tradeweb before BNY tokenized and settled it on its private ledger within minutes, bypassing the standard T+1 settlement cycle. Citadel then used the tokenized Treasury as collateral to raise overnight cash from BNY. BNY plans to expand digital cash capabilities and extend settlement hours into Asian and European trading timeframes by 2027.
Details of the tokenized repo transaction
- ▪The tokenized U.S. Treasury transaction settled on BNY's private digital ledger within minutes, bypassing the standard T+1 settlement cycle for U.S. Treasuries.
- ▪The transaction marks the first time tokenized assets have been used in a workflow on a major triparty repo platform.
- ▪Citadel Securities purchased a 2-year U.S. Treasury note through Tradeweb, which BNY recorded as a tokenized asset on its private ledger and Citadel then pledged as collateral in an overnight triparty repo to receive cash.
BNY's future digital platform plans
- ▪BNY plans to extend the operating hours of its traditional settlement platforms for Fed-eligible securities and U.S. triparty transactions into European and Asian trading hours in 2027.
- ▪BNY plans to pilot tokenized U.S. Treasuries on its private blockchain by the end of 2026 and target 24/7 settlement for conventional and tokenized Treasuries in 2027.
- ▪BNY plans to introduce additional digital cash and tokenized deposit capabilities to support institutional settlement and financing.
Traditional repo settlement delays
- ▪Traditional movement of government bonds between accounts and settlement systems can take time, leaving assets temporarily unavailable for secondary transactions or immediate collateral reuse.
- ▪The global repo market handles over $10 trillion in daily transaction volume, with traditional trades typically requiring T+1 or T+2 settlement periods.
Broadridge distributed ledger repo
- ▪Broadridge processed $7.5 trillion in distributed ledger repo transactions in September 2026, averaging $359 billion in daily volume on its own platform prior to BNY's triparty deal.
- ▪Broadridge expanded its distributed ledger repo network to support transactions involving G7 securities.
Institutional adoption of asset tokenization
- ▪Financial institutions including BlackRock, Franklin Templeton, and JPMorgan are advancing tokenized funds and traditional financial asset securities businesses on blockchain networks.
- ▪A September 2026 Citi report found that 77% of surveyed financial institutions were considering using tokenized collateral to move assets outside standard settlement hours.
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