Citi launches tokenized depositary receipts for private‑market shares

Citi announced the first market‑first tokenized depositary receipts (Digital Depositary Receipts) that represent private‑company shares, using a blockchain operated by SIX to issue and custody the tokens [1]. The product aims to simplify private‑market access, reduce intermediaries and lower hidden costs for issuers and investors.

Key takeaways

• Citi acts as both issuer and custodian for tokenized depositary receipts on private shares [1].
• The blockchain infrastructure is provided by SIX, a regulated digital central securities depository [1].
• The inaugural issuance involved Kaleido, a Citi portfolio company, and Citi Wealth investors [1].
• The offering is part of a broader industry move, with major U.S. banks planning a shared tokenized deposit network for wholesale payments slated for 2027 [2].
• Citi says the solution preserves voting rights and cap‑table simplicity while expanding investor outreach [1].

Digital Depositary Receipts: How the product works

Citi’s Digital Depositary Receipts apply its existing depositary receipt framework to private‑market equity, converting shares into blockchain‑based tokens that can be settled and held on the SIX platform. By acting as the sole trusted issuer and custodian, Citi seeks to eliminate the “multiple intermediaries” and “less transparent fees” typical of fragmented secondary markets [1]. The tokenized receipts retain the underlying ownership rights, including voting privileges, and allow companies to keep control of their cap tables while reaching a broader pool of institutional investors.

The first transaction was executed between Kaleido—a digital‑asset platform owned by Citi—and investors in Citi’s Wealth business, with support from the bank’s Secondary Private Markets team [1]. Citi’s internal collaboration spanned Issuer Services, Custody, Wealth, Markets and Ventures, demonstrating a coordinated “One Citi” effort to launch the product at scale.

Industry context: tokenized deposits beyond private equities

Citi’s initiative arrives as U.S. banks, including JPMorgan, Bank of America and Wells Fargo, prepare a shared Regulated Settlement Network (RSN) slated for launch in the first half of 2027 [2]. That network will enable 24/7 atomic settlement of tokenized deposits on a common blockchain, positioning bank‑issued tokens as regulated alternatives to stablecoins. While the RSN focuses on wholesale payments, Citi’s Digital Depositary Receipts target private‑company equity, illustrating how tokenized assets are being explored across different market segments.

Why it matters

The launch marks a notable shift for a major global bank into the tokenized‑asset space, offering private companies a new liquidity channel without a public listing and giving investors a familiar, custodial‑protected exposure to otherwise illiquid shares. By leveraging a regulated infrastructure (SIX) and maintaining traditional governance rights, Citi aims to combine the efficiency of blockchain with the safeguards of conventional finance. The product’s success could influence the upcoming bank‑wide tokenized deposit network, potentially extending similar tokenized structures to other asset classes and further blurring the line between traditional capital markets and digital‑asset ecosystems.