DTCC Tap Canton Network for Treasury Tokenization; SEC Grants No-Action Relief

The Depository Trust & Clearing Corporation (DTCC) announced a strategic partnership with Digital Asset’s Canton Network to tokenize U.S. Treasury securities, effectively moving the world’s largest settlement layer on-chain. The initiative is underpinned by a three-year “no-action” letter from the U.S. Securities and Exchange Commission (SEC), providing the regulatory cover necessary for institutional production workflows.

The Infrastructure Play

Unlike previous pilots restricted to internal sandboxes, this partnership targets a live Minimum Viable Product (MVP) in the first half of 2026. The DTCC, which processes over $3.7 quadrillion in securities transactions annually, will mint digital twins of U.S. Treasury bonds, select ETFs, and Russell 1000 index securities directly on the Canton Network.

The choice of Canton, a privacy-enabled blockchain, signals a definitive shift in institutional requirements. While public chains offer transparency, regulated entities demand the ability to transact atomically without exposing proprietary position data to competitors. Canton’s architecture allows for this selective disclosure while maintaining a unified ledger for settlement.

Regulatory “Green Light”

The operational catalyst here is the SEC’s no-action letter. This document assures the DTCC that the agency will not pursue enforcement action against the platform for three years, provided it operates within the specified “controlled production environment.” This removes the primary bottleneck. regulatory uncertainty, that has historically trapped similar projects in the “proof of concept” purgatory.

“This collaboration creates a roadmap to bring real-world, high-value tokenization use cases to market, starting with U.S. Treasury securities and eventually expanding to a broad spectrum of DTC-eligible assets.” — Frank La Salla, CEO of DTCC.

Why It Matters

This is a liquidity play. By tokenizing U.S. Treasuries, the pristine collateral of the global financial system, the DTCC aims to unlock 24/7 collateral mobility. Currently, moving Treasuries to meet margin calls over weekends or holidays is operationally friction-heavy. On-chain settlement allows these assets to move instantly, potentially freeing up billions in trapped capital for market makers and clearing firms.