BNY and Citadel use a tokenized Treasury for settlement and overnight repo

BNY and Citadel Securities have completed a workflow that took a tokenized U.S. Treasury from purchase and settlement into overnight financing. The bank’s October 13 announcement describes an executed transaction, connecting a digital representation of a conventional security with an established collateral market.

Citadel Securities purchased a two-year Treasury note through BNY on Tradeweb. BNY then recorded a tokenized representation on its private digital ledger and settled the transaction within minutes, according to the bank’s account of the workflow.

After settlement, Citadel used that tokenized Treasury as collateral in an overnight triparty repurchase transaction, receiving cash from BNY. The sequence is the central development: the security moved from a completed purchase into a separate financing use through the connected infrastructure.

BNY says this marks the first use of tokenized assets on a major triparty repo platform. That description is the bank’s claim about the transaction’s place in the market. The disclosed workflow is on BNY’s private ledger, so the announcement does not establish a freely transferable Treasury token on a public blockchain.

Brian Danga’s October 14 report for The Block corroborates the purchase, rapid settlement and overnight repo. The report places the transaction alongside BNY’s wider work on tokenized deposits for institutional customers, while keeping this particular Treasury workflow identifiable.

The settlement comparison in the announcement is with the standard T+1 cycle. Completing this transaction within minutes demonstrates the sequence the participants executed; it does not change the settlement timetable for every Treasury trade or establish that the whole market now operates around the clock.

BNY’s next stated steps include additional digital-cash and tokenized-deposit capabilities. It also expects to extend operating hours on traditional securities-settlement and U.S. triparty platforms, looking toward European and Asian trading hours next year. Those extensions are plans, separate from the transaction already completed.

For institutions, the test concerns whether collateral becomes available for financing sooner after acquisition. This announcement supplies a concrete example of that sequence. Wider operating hours and further client use remain the next developments to verify.

Sources

BNY: tokenized Treasury triparty repo workflow · BNY and Citadel Treasury repo