On-chain financing of treasuries completed for the first time in real-time

In a groundbreaking development, Digital Asset, in collaboration with a consortium of leading financial institutions, has successfully completed the first real-time, fully on-chain financing of U.S. Treasury bonds (UST) against the USDC stablecoin on the Canton Network. This landmark transaction, executed on a Saturday using Tradeweb's platform, represents a significant departure from prior on-chain repurchase agreement (repo) activities.

The transaction converted U.S. Treasury bonds held by the Depository Trust & Clearing Corporation (DTCC) into tokenized assets on the Canton Network. These tokenized Treasuries then served as collateral for financing provided in USDC, which was minted and redeemed on-chain to enable near-instant, atomic settlement. This process eliminates the limitations of off-ledger cash legs and market-hour restrictions seen in legacy implementations, providing true 24/7 liquidity.

24/7 Capital Markets Infrastructure

Conducting financing on a weekend outside traditional business hours demonstrates the viability of round-the-clock capital markets liquidity. This development eliminates settlement windows and enables true 24/7 access to financing, a significant step towards creating a continuously operational capital markets infrastructure.

Interoperability and Accessibility

The Canton Network’s Global Collateral Network provides an interoperable infrastructure where high-quality liquid assets like UST can move freely and serve as collateral in near real-time across institutional and digital asset domains. This interoperability increases accessibility, enabling a broader range of participants to engage in capital markets activities.

Market Efficiency and Innovation

Near-instant, atomic settlement via a public blockchain increases market efficiency by reducing settlement risk and delays inherent in legacy systems. This unlocks new possibilities for liquidity management and financial product innovation.

Bridging TradFi and DeFi

The initiative combines traditional financial trust and scale with the programmability and flexibility of decentralized finance (DeFi), paving the way for a unified global digital financial system infrastructure. This bridging of traditional finance (TradFi) and decentralized finance (DeFi) is a significant step towards a more integrated and efficient financial ecosystem.

Participants emphasized that this milestone moves beyond proof of concept towards practical, scalable blockchain applications in capital markets. Additional similar transactions are planned to further expand this foundational capability, advancing the vision of a globally accessible, liquid, and efficient capital market ecosystem.

Chris Zuehlke, Partner at DRW and Global Co-Head of Cumberland, expressed excitement about the executed on-chain financing of tokenized US treasuries against USDC, signifying blockchain's potential for unlocking 24/7 funding. Kash Razzaghi, Chief Business Officer at Circle, stated that the successful use of tokenized U.S. Treasuries and on-chain settlement via USDC highlights collaborative innovation across traditional and digital financial institutions.

Justin Peterson, Chief Technology Officer at Tradeweb, stated that the successful completion of this transaction marks a significant step toward 24/7 trading in these markets. Brian Steele, Managing Director, President, Clearing & Securities Services at DTCC, affirmed DTCC's commitment to advancing infrastructure that supports evolving client needs with a scalable, future-focused, and digital-first approach.

Sonali Theisen, Global Head of FICC E-Trading and Markets Strategic Investments at Bank of America, expressed enthusiasm for collaborating in the initiative to explore new applications of blockchain within traditional finance for institutional clients. Dan Eckstein, Head of Rates Sales at Virtu Financial, declared that the first live transaction on the Canton Network demonstrates the potential for real-time, 24/7 financing.

Kelly Mathieson, Chief Business Development Officer at Digital Asset, emphasized the Global Collateral Network on the Canton Network's ability to respect confidentiality while transacting on a public blockchain, enabling real-time collateral mobility and round-the-clock financing. Tradeweb's deep U.S. Treasury liquidity and electronic execution capabilities were leveraged to complete this pioneering transaction.

The transaction occurred on a Saturday, demonstrating the ability to access financing outside traditional global settlement windows. Members of the working group focused on advancing on-chain initiatives include Bank of America, Circle, Citadel, Cumberland DRW, Digital Asset, DTCC, Hidden Road, Societe Generale, Tradeweb, and Virtu Financial. This milestone marks a foundational step towards building capital markets where high-quality liquid assets, such as UST, are available and usable at all times, regardless of traditional market hours or legacy settlement constraints.