Citi launches tokenized depositary receipts for private‑company shares

Citi announced the market‑first launch of Digital Depositary Receipts that tokenise private‑company shares, offering a blockchain‑based, custodial solution aimed at expanding wealth‑client access to illiquid private markets [1].

Key takeaways

• Citi acts as both issuer and custodian of tokenised depositary receipts for private shares [1].
• The product uses SIX’s regulated digital central securities depository to mint and settle the tokens [1].
• The inaugural issuance involved Kaleido, a Citi portfolio company, and Citi Wealth investors [1].
• Citi positions the offering as a single‑point, cost‑effective alternative to multi‑intermediary SPV structures [1].
• The bank plans future extensions across multiple blockchain networks and traditional market infrastructures [1].

Digital Depositary Receipts: a new bridge to private markets

Citi’s Digital Depositary Receipts apply its existing depositary receipt framework to private‑company equity, converting shares into blockchain‑based tokens while retaining the underlying voting rights and cap‑table simplicity for issuers. By acting as the sole issuer and custodian, Citi aims to reduce the complexity and hidden fees often associated with secondary private‑market transactions that rely on third‑party special purpose vehicles. The tokenisation infrastructure is provided by SIX, one of the world’s first fully regulated digital central securities depositories, which handles settlement and safekeeping of the receipts [1].

The first transaction was executed between Kaleido—a digital‑asset platform and Citi portfolio company—and investors in Citi’s Wealth business, with support from the bank’s Secondary Private Markets team. Citi described the launch as a coordinated “One Citi” effort, drawing on its Issuer Services, Custody, Wealth, Markets, and Ventures groups to deliver a scalable model for future issuances [1]. The bank highlighted that the product allows private companies to raise capital without a public listing or changes to ownership rights, while giving wealth clients a familiar investment structure enhanced by digital‑asset technology [1].

Why it matters

Citi’s entry into tokenised private‑equity aims to address growing demand for liquidity among private firms and to simplify investor access to these assets. By leveraging a regulated blockchain platform and consolidating issuance and custody functions, the bank seeks to provide an institutional‑grade, cost‑effective alternative to fragmented secondary markets. The rollout signals a broader trend of traditional financial institutions integrating digital‑asset infrastructure, and Citi’s stated intention to expand the offering across additional blockchain networks suggests further development of hybrid digital‑and‑traditional market solutions [1].