BNY Mellon has conducted its first triparty repurchase agreement (repo) trade on a major financial platform utilizing tokenized US Treasury collateral. The transaction, carried out in collaboration with market maker Citadel Securities, demonstrates the potential for digital assets to streamline the settlement and funding process for Treasury securities.
Transaction details and industry commentary
Citadel Securities purchased a two-year US Treasury note through BNY Mellon on the Tradeweb platform. A tokenized version of this Treasury was recorded on BNY Mellon’s private ledger, enabling the transaction to settle in minutes rather than the standard T+1 period. Citadel Securities employed the tokenized collateral for an overnight triparty repo, receiving cash from BNY Mellon in exchange.
Dan Doherty of Citadel Securities described the transaction as “a practical use case that shows how tokenized US Treasuries can move from settlement into financing more efficiently.” Carolyn Weinberg of BNY Mellon highlighted the trade’s implications, noting its relevance “across both settlement and financing.”
Dan Doherty described the transaction as a practical demonstration of how tokenized US Treasuries can streamline both settlement and financing, while Carolyn Weinberg emphasized its significance for the entire process.
Although tokenized repo itself is not new, the execution of such a transaction through a major triparty platform marks a significant development for the industry. BNY Mellon, known as one of the world’s leading custody banks, has been at the forefront of digital asset integration into traditional finance.
Mini dictionary: Triparty repo, a type of repurchase agreement where a third-party agent facilitates collateral management and settlement between two trading entities, is widely used to support secure financing in financial markets.
Comparisons and potential scalability
Tokenized repo transactions already operate at a substantial scale. Financial technology company Broadridge Financial Solutions reported processing $7.5 trillion in tokenized repo transactions during September 2026 alone, averaging $359 billion in trades each day. Broadridge uses its own distributed ledger platform for these activities.
Meanwhile, the global repo market processes over $10 trillion in trades daily, making timely settlements a key challenge. Traditional collateral moves on timelines such as T+1 or T+2, and margin adjustments are often processed in batches. Callan, an institutional investment consulting firm, has noted that “timing is the root issue,” positioning tokenization as a possible solution to speed up collateral transfers. However, BNY Mellon’s single transaction is not seen as sufficient to confirm sector-wide improvements.
| Institution | Tokenized Repo Volume | Platform | Settlement Time |
|---|---|---|---|
| BNY Mellon | Initial pilot (undisclosed) | Private ledger, Tradeweb | Minutes |
| Broadridge | $7.5 trillion (Sep 2026) | Distributed ledger | Same-day |
Expansion plans and global reach
For 2027, BNY Mellon aims to expand its Fed-eligible payment settlement services and triparty repo operations into Europe and Asia. Plans are also underway to introduce digital cash functionalities. Extended operating hours could make international funding more seamless by allowing cash and collateral to move together across time zones.
The tokenized repo market shows promise due to the vast potential for global reach. Data from the International Capital Market Association (ICMA) indicated approximately €14.9 trillion in outstanding European repo agreements in the first half of 2026. Broadridge has responded to this evolving market by extending its services to cover G7 securities.
Mini dictionary: ICMA is the International Capital Market Association, an organization representing financial institutions active in global capital markets, including repo markets and bond trading.
However, the efficiency of tokenized repos depends not only on the digitalization of securities but also on seamless access to digital cash for settlement. BNY Mellon took a step forward by launching its tokenized deposit product in January 2026, advancing the digitization of the settlement process.
Interoperability and regulation
BNY Mellon’s private ledger is just one among several systems participating in this transformation. In July 2026, the Depository Trust & Clearing Corporation (DTCC) tokenized securities held at the Depository Trust Company (DTC) using Hyperledger Besu and Canton blockchain frameworks, with over 30 firms involved in pilot tests. Their trials included tokenized Treasury repo delivery-versus-payment exercises, with production services scheduled to start in October 2026.
The Bank for International Settlements (BIS) has cautioned that digital settlement mechanisms must maintain public trust in money and ensure legal finality in transactions. Industry stakeholders also recognize the challenges posed by fragmented liquidity and cross-ledger risks. A major question concerns the ability of these systems to exchange collateral securely and efficiently at scale.
Institutions continue to address fragmented liquidity and cross-ledger risks, while questions about the secure and scalable transfer of collateral remain central to the adoption of tokenized repo solutions.
