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Citigroup has introduced Digital Depositary Receipts, a blockchain-based product designed to provide wealthy and institutional investors with exposure to private company equity. By adapting traditional depositary receipt structures, Citi acts as both the issuer and custodian, recording the securities on blockchain infrastructure operated by the Swiss firm SIX. The bank intends for this model to simplify private-market investing by reducing reliance on the special-purpose vehicles and multiple intermediaries often used in current structures.
This initiative is part of a broader strategy by major financial institutions to tokenize traditional assets, such as stocks and bank deposits, to potentially improve settlement times and reduce costs. The product debuted with a transaction involving Kaleido, a company backed by Citi Ventures. While the current offering utilizes infrastructure from SIX, Citi has indicated plans to expand the service over time, including potential future support for public blockchain networks.
Citi's Digital Depositary Receipts allow investors to gain exposure to private company shares through blockchain-based securities.
The product utilizes blockchain infrastructure provided by the Swiss market operator SIX.
Citi serves as both the issuer and custodian for the digital receipts, which represent ownership of private company equity.
The launch aims to address investor demand for private-market access as companies remain private for longer periods before going public.
Citi plans to expand the offering in the future, with potential integration into public blockchain networks.
They are blockchain-based securities issued and held by Citi that allow investors to gain exposure to private company shares.
The product is designed for wealthy and institutional investors.
Unlike traditional structures that often rely on special-purpose vehicles and multiple intermediaries, Citi's approach uses blockchain technology to simplify the process and increase transparency.
The product launched with a transaction involving Kaleido, a digital asset and tokenization firm backed by Citi Ventures.
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