BNY Uses Tokenized US Treasury in Landmark Citadel Repo Deal

BNY Mellon and Citadel Securities have completed a historic financing transaction that used a tokenized 2‑year U.S. Treasury note as collateral on a major triparty repo platform. The Treasury was tokenized on BNY’s private ledger, settled within minutes, and then pledged by Citadel for an overnight repurchase agreement, with BNY providing cash.

Tokenization and Settlement

The process began when Citadel purchased the Treasury note on Tradeweb. BNY recorded a digital representation of the security on its private ledger, achieving settlement in minutes—far faster than the standard T+1 settlement for conventional Treasuries.

Repo Execution

BNY acted as the triparty infrastructure provider, accepting the tokenized Treasury as collateral and extending cash to Citadel for the overnight repo. The bank did not disclose the transaction’s value, financing rate, or cash amount.

Institutional Implications

Carolyn Weinberg, BNY’s chief innovation and market transformation officer, said the deal shows how tokenized assets can move across settlement and financing stages, creating a more connected and efficient financial system. Dan Doherty of Citadel highlighted the importance of rapid collateral movement for market functioning.

Key facts

• First use of tokenized assets on a major triparty repo platform.
• 2‑year Treasury note tokenized on BNY’s private ledger.
• Settlement completed within minutes, bypassing the usual T+1 cycle.
• BNY supplied cash against the tokenized Treasury in an overnight repo.
• No transaction value or rate disclosed.