The Depository Trust & Clearing Corporation (DTCC) launched its securities tokenisation service on 28 October under a limited US regulatory arrangement that restricts transfers to registered participant wallets and gives tokenised holdings no value in specified risk-management calculations at its subsidiary, the Depository Trust Company (DTC). The launch puts the conditions of an earlier Securities and Exchange Commission staff no-action letter into practical focus, rather than creating a general approval for blockchain-based securities trading.
In its launch announcement, DTCC said the service was integrated with the Canton Network and its private Besu network. Twenty DTC participants had signed access agreements. That is a count of signed participants, not a statement that all 20 were already transacting. Additional blockchain networks are planned for 2027.
The regulatory basis dates to 11 December 2025. SEC trading and markets staff agreed not to recommend enforcement action under specified provisions for the pilot described by DTC. The response addresses systems-compliance rules, rule-filing requirements and particular clearing-agency standards. It does not settle every legal question raised by tokenisation.
Access stays within registered wallets
Under the arrangement described in the letter, only DTC participants can register wallets. Tokens can move only between those registered addresses, with each participant responsible for activity in its wallets. Participation is voluntary, and participants can begin or end their involvement by notifying and instructing DTC.
The letter also excludes participants for which DTC has specified US tax withholding or reporting duties, or Treasury International Capital reporting obligations. A supported blockchain and successful DTC wallet screening against US sanctions requirements are prerequisites for wallet registration. This is therefore an institutional access framework, not unrestricted transfers to any personal crypto wallet.
The permitted securities categories cover Russell 1000 constituents at launch, later additions to that index, US Treasury bills, bonds and notes, and exchange-traded funds tracking major indices. Securities that subsequently leave the Russell 1000 can remain eligible under the letter. Those categories define the permitted scope, not the number of instruments actually available on launch day.
Ownership and risk controls remain central
Tokenisation changes how a participant's security entitlement is recorded. DTC moves the relevant securities from the participant's account into a digital omnibus account and creates a corresponding token. Reversing that process requires the token to be destroyed before the securities return to the participant's conventional account.
The underlying securities remain registered in the name of Cede & Co., DTC's nominee. Securities in the omnibus account cannot be transferred out while the corresponding token remains outstanding. That restriction is intended to prevent the same position being transferred through both the conventional ledger and the blockchain.
DTC's LedgerScan system tracks token transfers and wallet holdings, with its record serving as DTC's official record of the tokenised entitlements. The technology requirements also preserve DTC's ability to correct erroneous entries, recover lost tokens or respond to misconduct through reversals.
A separate restriction applies to DTC's risk management. Tokenised entitlements receive no collateral or settlement value when DTC calculates a participant's Net Debit Cap or Collateral Monitor. The restriction concerns those DTC calculations; it should not be read as a blanket prohibition on every possible collateral use elsewhere.
Quarterly reporting accompanies the pilot
DTC's commitments include quarterly reports to SEC staff on participating firms, tokenised holdings and transfer volumes. Reports must also cover registered-wallet numbers, supported blockchains, reversals and outages. They are due no later than the third Friday after each quarter ends, with the information subsequently going to DTCC's board.
Material system disruptions, compliance problems or intrusions require notification to staff as soon as reasonably practicable, followed by updates and a resolution notice. Key systems must support recovery within four hours, no more than two minutes of data loss and annual out-of-region recovery testing.
The letter withdraws automatically three years after DTC launches the specified preliminary version, with written notice required at launch. It also permits SEC staff to modify or revoke the position at any time. The response offers no conclusion about other federal or state laws or self-regulatory rules, leaving those obligations outside its narrow enforcement assurance.
Related coverage: SEC puts tokenization into 2027 examination priorities.
ESMA seeks evidence on tokenised collateral at clearing houses.
