Morgan Stanley has confirmed that it is now using the DTCC Tokenization Service (DTS) to convert US equities and Treasury securities into tokenized assets. The bank disclosed the development in a post on X, noting that it is among the first major banks to leverage the new platform following its recent launch.
Launch of Tokenization Service
The Depository Trust & Clearing Corporation (DTCC), a primary settlement and clearing institution in the US financial markets, introduced the Tokenization Service on October 28 through its subsidiary, the Depository Trust Company (DTC). The service allows participating financial institutions to issue “digital twins” of existing securities, backed one-to-one by assets already held in DTC custody.
At its rollout, 20 DTC participants, including leading banks such as Morgan Stanley, Bank of America, Citi, and J.P. Morgan, signed on to use the platform. However, DTCC did not specify which institutions had begun actively tokenizing real-world assets at launch.
Morgan Stanley now distinguishes itself within this group as a stated user of the DTS, even though the bank has not revealed details on which securities have been tokenized, the volumes involved, or whether these digital assets are managed on behalf of the bank itself or its clients.
How the Service Works
According to DTCC’s overview of the DTS, eligible participants can convert securities positions between traditional book-entry and tokenized form, and back, at any time. The digital tokens retain their original CUSIP numbers and maintain all holder rights and protections, while DTC remains the official custodian and record keeper. This design ensures continuity and compliance within regulated financial markets.
A December 2025 Securities and Exchange Commission no-action letter currently covers the tokenization of Russell 1000 stocks, major index-tracking ETFs, and various Treasury instruments, enabling these assets to transition into digital form under clear regulatory guidelines.
| Asset Type | Eligible for DTS Tokenization | SEC No-Action Status |
|---|---|---|
| Russell 1000 equities | Yes | Covered |
| Index ETFs | Yes | Covered |
| Treasuries (bills, notes, bonds) | Yes | Covered |
Industry Implications and Future Roadmap
DTCC refers to these on-chain representations as “digital twins,” describing a process where tokenized securities are always backed by the corresponding assets in custody. The system currently operates on two networks: the Canton Network and a private Hyperledger Besu network maintained by DTCC. Integration with Stellar and Circle’s Arc is planned for 2027, further broadening the platform’s reach.
Morgan Stanley, one of the largest global investment banks, has taken steps over recent months to explore digital asset solutions. Amy Oldenburg, Morgan Stanley’s head of digital assets strategy, reported that the institution views hands-on engagement with tokenized securities as crucial for advancing its capabilities as financial technologies evolve.
The experience of integrating tokenized securities into established market infrastructure will help shape ongoing efforts to develop digital asset capabilities as the market landscape changes.
DTCC’s roadmap for the DTS envisions future expansion into on-chain netting, digital cash, and enhanced settlement and collateral management features starting in 2027, though these plans are labeled as indicative and could change.
Other firms, such as Ondo, whose broker-dealer joined DTCC’s Fund/SERV network in September, have also been cited among the early collaborators for the tokenization project.
Morgan Stanley executives, including Oldenburg, have indicated that the bank is developing a dedicated lab to test various stablecoin, tokenization, and decentralized finance (DeFi) tools in parallel to its core financial operations.
Meanwhile, DTCC continues to guide market participants through new technical capabilities and evolving regulatory frameworks as traditional finance adapts to advances in blockchain and tokenization.
Mini dictionary: DTCC (Depository Trust & Clearing Corporation) is a key infrastructure provider in the US financial system, offering settlement, clearing, and custody services for a large volume of securities worth trillions of dollars each day.
