DTCC Plans Tokenization of Stocks, ETFs, and Treasurys After SEC No-Action Letter

Tech

DTCC Plans Tokenization of Stocks, ETFs, and Treasurys After SEC No-Action Letter

The Depository Trust and Clearing Corporation (DTCC) has received an SEC no-action letter enabling its subsidiary to tokenize stocks, ETFs, and US Treasurys, with services launching in the second half of 2026 to enhance market efficiency through blockchain integration.

• DTCCs DTC subsidiary gains approval to tokenize highly liquid assets like the Russell 1000 index and US Treasury securities.
• The no-action letter provides regulatory clarity, allowing operations on pre-approved blockchains for three years without enforcement action.
• This initiative could enable 24/7 trading, improved collateral mobility, and programmable assets, potentially transforming traditional securities markets.

What is the DTCC Tokenization SEC No-Action Letter？

DTCC tokenization SEC no-action letter refers to the regulatory approval granted by the US Securities and Exchange Commission (SEC) to the Depository Trust Company (DTC), a subsidiary of the Depository Trust and Clearing Corporation (DTCC), allowing it to launch a tokenization service for traditional securities. This letter assures that the SEC will not pursue enforcement actions if the service operates as outlined, focusing on tokenizing real-world assets on blockchain while preserving all original entitlements, protections, and rights. The move marks a significant step in integrating blockchain technology with established financial infrastructure, with the service set to begin in the second half of 2026.

What Assets Will DTC Tokenize Under This Initiative？

The DTC plans to tokenize a select group of highly liquid assets, including components of the Russell 1000 index, exchange-traded funds (ETFs) that track major market indexes, and various US Treasury securities such as bills, bonds, and notes. This controlled production environment will utilize pre-approved blockchains to create digital representations of these assets. According to DTCC‘s announcement, the tokenized versions will maintain identical investor protections and ownership rights as their traditional counterparts, ensuring seamless integration into existing market systems. Experts note that this could process over $2 quadrillion in securities annually through DTCC’s infrastructure, potentially reducing settlement times and costs significantly—traditional settlements often take T+1 days, while blockchain could enable near-instantaneous transactions. DTCC CEO Frank La Salla emphasized the transformative potential, stating, “Tokenizing the US securities market has the potential to yield benefits such as collateral mobility, new trading modalities, 24/7 access, and programmable assets.” This aligns with broader industry trends, as reported by financial analysts, where tokenization is projected to unlock trillions in illiquid assets by 2030.