BNY and Citadel Securities Complete Tokenised Treasury Collateral Transaction
Key points
- BNY and Citadel Securities completed a transaction on or before 13 October 2026 demonstrating that tokenised U.S. Treasuries can transfer from settlement into financing within a single workflow.
- The transaction targeted collateral immobility, the period during which government bonds used to secure short-term loans and fund trading are tied up and unavailable for reuse.
- Citadel Securities' Dan Doherty stated that reducing delays across the trade lifecycle could improve institutional market operations, while BNY's Carolyn Weinberg described the goal as an always-on financial system.
- BNY plans to introduce additional digital cash and tokenised deposit capabilities and to extend traditional settlement hours for Federal Reserve-eligible securities and U.S. triparty transactions to cover European and Asian hours next year.
- The development positions collateral mobility, rather than fund tokenisation alone, as a distinct and increasingly validated use case, building on prior commitments from BlackRock, Franklin Templeton, and JPMorgan.
BNY, the world’s largest custody bank, and Citadel Securities announced on Tuesday that they had completed a transaction using tokenised U.S. Treasuries, demonstrating how blockchain-based government bonds could move between settlement and financing more rapidly than conventional rails allow. The test targeted a persistent bottleneck: the time it takes to shift high-quality collateral between accounts and settlement systems, during which assets are effectively frozen and unavailable for other uses.
The transaction was designed to show that a tokenised representation of a U.S. Treasury could serve double duty, functioning first in settlement and then in financing without the delays that currently separate those two functions. Dan Doherty, digital assets operations lead at Citadel Securities, noted in a statement that efficient movement of high-quality collateral is fundamental to well-functioning markets, and that reducing delays across the trade lifecycle could improve how institutional markets operate. Carolyn Weinberg, BNY’s chief innovation and market transformation officer, framed the outcome as a step toward a more connected and always-on financial system.
BNY said it intends to broaden its digital cash and tokenised deposit capabilities to support blockchain-based settlement and financing going forward. The bank also indicated it plans to extend operating hours for its traditional settlement systems covering Federal Reserve-eligible securities and U.S. triparty transactions, with the stated aim of reaching European and Asian trading hours next year. That combination, longer conventional hours plus expanded tokenised infrastructure, suggests BNY is hedging across both near-term incremental improvement and longer-term structural change.
The move arrives as a cohort of major institutions, including BlackRock, Franklin Templeton, and JPMorgan, have already committed to tokenised funds and securities, making this transaction less a market first and more a signal that collateral mobility is becoming the next specific use case to attract serious institutional validation.
More on the wire
- BNY and Citadel Securities Complete First Tokenised Treasury Triparty Repo on a Major Platform
- BNY brings digital asset custody to EU under MiCA framework
- Federated Hermes and Prometheum target retail brokerage accounts with tokenised MMFs
- Federated Hermes Plans Tokenised Fund Shares via Prometheum Partnership