Morgan Stanley begins tokenizing U.S. stocks and Treasuries via DTCC

What happened

Morgan Stanley says it has started turning U.S. equities and Treasury securities into blockchain-based tokens through the Depository Trust & Clearing Corporation's new tokenization service, making it one of the first banks to do so. The firm announced the step in a post on X dated Nov. 3, six days after the platform went live on Oct. 28. In that post it described itself as among the first banks to tokenize real-world assets since the service launched.

The disclosure was thin on specifics. Morgan Stanley did not identify which securities it tokenized, how large the positions were or which blockchain carried them, and it did not say whether the tokens are held for clients or for the bank's own account. Crypto.news reported that the bank confirmed the transactions converted conventional assets into blockchain representations, while Unchained noted that the post moved the firm from a list of signed-up participants to a stated user, without revealing any scale.

Amy Oldenburg, Morgan Stanley's head of digital assets strategy, framed the work as a learning exercise. The experience of wiring tokenized securities into established market infrastructure, she said, will inform how the firm develops its digital asset capabilities as the market evolves. The bank has spent months building that groundwork, including a digital asset lab set up in September and a planned venue for trading tokenized equities.

Why it matters

The significance lies less in the size of the transactions than in who keeps the record. DTCC calls the instruments digital twins, each backed one-for-one by a security the Depository Trust Company already holds in custody. A token carries the underlying instrument's CUSIP and the holder's rights and protections, and DTC remains the official record keeper, so an eligible participant can move a position between book-entry and token form in either direction. For a large bank, that offers experience with blockchain rails while staying inside regulated market infrastructure rather than outside it.

It also tests whether tokenization can be adopted as an operational add-on rather than a parallel market. Because ownership rights and protections are unchanged, the exercise is mostly about plumbing: how positions are converted, held and moved between wallets and existing systems.

What the data shows

DTC holds more than $114 trillion in assets under custody, a figure that reflects its overall securities holdings rather than anything already tokenized. The service initially runs on two networks: the Canton Network and a private Besu network operated by DTCC, with Stellar and Circle's Arc expected in 2027. DTCC's roadmap lists on-chain netting, digital cash and broader settlement and collateral uses for 2027 and later, on a timeline the company describes as indicative and subject to change. Ondo, whose broker-dealer joined DTCC's Fund/SERV network in September, is among the named collaborators.

Background

DTC, a DTCC subsidiary, opened the tokenization service on Oct. 28 with 20 participating institutions, among them JPMorgan, Citi, Bank of America, Barclays, BNP Paribas, Fidelity Investments, State Street and UBS. At launch DTCC did not name any of them as having actually tokenized assets. The service rests on regulatory relief: a December 2025 SEC no-action letter covers Russell 1000 stocks, exchange-traded funds that track major indices, and Treasury bills, notes and bonds.

DTCC says more than 150 firms contributed to the platform's design, and its July production transactions included securities lending, collateral transfers and U.S. Treasury repurchase agreements. Morgan Stanley, meanwhile, has been assembling custody arrangements, wallet infrastructure and research around stablecoins, tokenized deposits, money market funds and decentralized finance.

What to watch

Morgan Stanley's tokenization work is separate from its plan to support tokenized equity trading through its alternative trading system in the first quarter of 2027, a target pushed back from the second half of 2026. Oldenburg has said the bank needed suitable products and additional infrastructure before that venue could open. Speaking at TOKEN2049 in October, she said institutional demand was constrained by a shortage of tokenized products and projected that the real-world asset token market could reach between $3 trillion and $10 trillion by 2030. Elsewhere, the New York Stock Exchange said on Nov. 2 that it had added four transfer-agent partners for its proposed blockchain-based trading venue.

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