After a landmark July 15th trial testing near-real-time settlement, collateral mobility and multi-chain interoperability, DTCC’s Thomas Sullivan tells John Lothian News how the clearing giant plans to fuse traditional securities infrastructure with blockchain rails ahead of a full production launch later this year.
WILLIAMS BAY, WI (JLN) — August 28, 2026: The Depository Trust & Clearing Corporation, which has spent five decades building the plumbing that keeps US securities markets settling smoothly, is betting that blockchain technology can keep assets moving efficiently as trading speeds up and demand grows for round-the-clock liquidity.
Speaking with John Lothian of John Lothian News over Zoom, Thomas Sullivan framed the effort as a direct descendant of DTCC’s founding mission 50 years ago, when the company was created to resolve the paper crisis that threatened to overwhelm markets as trading volumes exploded. Some blockchain-native issuance models, he warned, risk recreating that same fragmentation problem. DTCC’s alternative is a “digital twin” structure — what Sullivan called “the best of both worlds” — keeping traditional and tokenized securities interoperable while preserving market liquidity and integrity.
DTCC’s public rollout centered on a one-day event on July 15th, when the company opened its environment for real transactions involving tokenized assets on blockchain networks, using both the Canton blockchain and DTCC’s own purpose-built collateral app chain. About 10 member firms participated directly, alongside a broader ecosystem of application and wallet providers, testing the transaction types they expect to run once the service reaches production later this year, chiefly around collateral mobility.
The standout results centered on speed. Instead of the customary T+1 timeline for trades or overnight and term structures for repo, the trial produced direct settlement in near real time, plus repo and securities-lending transactions with intraday terms as short as 15 minutes to an hour.
Moving assets between traditional and tokenized form runs through what DTCC calls a “conversion order.” A member’s request pulls the underlying security from its participant account into an omnibus account controlled by DTCC, while simultaneously minting a token into a wallet the member controls. A “burn instruction” reverses the process. Both happen in near real time, though minting and burning are limited to DTCC’s operating hours of 2 a.m. to 6 p.m. Eastern. Once minted, a token can move continuously, 24-7, 365, including between blockchains, via the same mint-and-burn mechanism.
Token holders retain the same entitlements as traditional shareholders, Sullivan said: identifiers such as CUSIPs, ISINs and ticker symbols carry over unchanged, along with access to the same liquidity, voting rights and dividends. At launch, corporate actions and payments will still flow through traditional channels via a firm’s DTCC participant account; native on-chain dividends are planned as a future build-out, not a day-one feature.
More fundamentally, DTCC’s model preserves the existing legal and risk framework. The underlying assets never leave DTCC’s control even once a tokenized representation exists, and remain governed by UCC Article 8’s book-entry rules. DTCC built an application called LedgerScan to give members a unified view, tracking positions and activity across both tokenized and traditional forms in real time and serving as the firm’s official books and records. “The buck stops with DTCC,” Sullivan said. Compliance tools round out the risk framework: DTCC can freeze assets in motion or claw them back if needed, and wallet infrastructure is run by regulated member institutions handling KYC — all meant to ensure token holders face “the same risk profile as we have with traditional securities.”
Nasdaq and NYSE both participated in the July event, executing trades on their traditional exchanges before tokenization occurred as a post-trade step, with only the settlement location shifting onto blockchain rails. Other models are emerging too, including Treasury trades matched on platforms like Tradeweb, where settlement orchestration happens natively on-chain for more real-time processing. But Sullivan said the bigger opportunity lies beyond trading itself, in asset mobility after tokenization — particularly for posting collateral and executing securities lending and repo transactions, including intraday and off-hours activity aligned with the spread of 24-5 equity trading and 24-7 crypto markets.
DTCC’s service currently runs on the Canton network and its own BayZ network, with two additional networks already announced for a 2027 launch. The strategy, Sullivan said, gives members flexibility to match network characteristics — privacy features, gas-fee costs — to their specific use cases. “This is really about choice, and we’re enabling choice in the market,” he said. “We’re really driven by what our members want, what the market wants.”
Sullivan pointed to collateral mobility as the likely early leader, driven by global systemically important banks looking to cut treasury costs. He also flagged “collateral upgrade trades” — pairing an equity leg with a Treasury leg — as a strong candidate for smart-contract efficiency, since equities settle through DTCC while Treasuries settle through Fedwire and bank custodians today. A third growth area is retail: wallet-first brokerage models where clients want equities, Treasuries, crypto assets and stablecoins housed in a single wallet-based ecosystem. “You see all of these really having substantial traction,” Sullivan said.
