Wall Street’s Plumbing Goes Onchain as Morgan Stanley Tokenizes Securities
Morgan Stanley says it has converted U.S. equities and Treasuries into tokenized form through the newly launched DTCC Tokenization Service, which 20 Wall Street firms have signed up to use.
Morgan Stanley has tokenized U.S. equities and Treasury securities using the newly launched DTCC Tokenization Service, marking a significant step in the integration of traditional finance infrastructure with blockchain technology. The Depository Trust & Clearing Corporation, which processes trillions of dollars in securities transactions annually, has attracted 20 Wall Street firms to its new tokenization platform since its launch.
The DTCC serves as the central clearing and settlement backbone for U.S. financial markets, handling the post-trade processing that keeps equity and bond markets functioning. Its decision to build a tokenization service reflects growing institutional pressure to modernize legacy settlement systems, which currently operate on multi-day cycles and rely on decades-old infrastructure. Tokenization converts ownership rights in real-world assets into digital tokens recorded on a blockchain, enabling faster and more transparent transfers.
The participation of 20 financial institutions signals that tokenization of traditional securities is moving beyond experimental pilot programs into operational deployment. Faster settlement, reduced counterparty risk, and lower operational costs are among the efficiency gains the industry expects from bringing securities onchain. Morgan Stanley's involvement adds further legitimacy, given the firm's size and influence across global capital markets.
Observers will be watching whether the DTCC expands the asset classes available for tokenization and how regulators, particularly the SEC, respond to securities being represented and transferred in tokenized form at scale.
Source: Decrypt
