Breakthrough: Citi and SDX Partner to Revolutionize Private Markets with Tokenization
Big news is shaking up the finance world, particularly for those watching the evolution of digital assets and traditional markets. A significant move in the realm of Tokenization has just been announced. Investment bank Citi and Switzerland’s SIX Digital Exchange (SDX) are joining forces to modernize traditional private markets. This partnership leverages blockchain technology to transform how private company shares are handled, aiming to bring new levels of efficiency and access.
Bringing Efficiency to Private Markets Through Tokenization
Citi and SDX are teaming up specifically to tokenize late-stage private shares. The goal is to improve efficiency and broaden access within the traditionally opaque Private Markets sector. Announced during the Point Zero Forum in Switzerland, this initiative will utilize SDX’s blockchain-based Central Securities Depositary (CSD) platform. The platform is designed to tokenize, settle, and safekeep assets.
The SDX platform is expected to go live by the third quarter of 2025. It will make late-stage, pre-IPO equities available to institutional and eligible investors globally. For companies issuing shares, the project provides a compliant and scalable way to manage liquidity for early investors and employees, while keeping control of their cap table. For investors, it offers access to high-growth, venture-backed companies more efficiently and transparently.
David Newns, head of SDX, expressed enthusiasm about the collaboration, stating, “We are excited to welcome Citi to the SDX platform and together deliver this landmark project in the tokenization of private shares.” He added that this partnership will “enable the efficient distribution of shares in mature international private companies, which are expected to generate strong investor interest.”
Citi’s Role in the Tokenization Ecosystem
Citi will play a crucial role, providing comprehensive servicing for these tokenized assets. They will act as the digital custodian and tokenization agent. Ryan Marsh, head of innovation at Citi, noted, “We are meeting client demand for access to emerging and relevant digital asset ecosystems and investments.” Marni McManus, Citi’s country officer for Switzerland, highlighted the growing opportunity in private markets, emphasizing how digitizing this sector can move it away from manual and paper-based processes.
Citi has been a vocal supporter of tokenization, viewing it as a potential major use case in the digital asset space. In September 2023, Citigroup launched Citi Token Services, a private, permissioned blockchain platform for cross-border payments, liquidity, and trade finance solutions for institutional clients. Earlier in 2024, Citigroup also worked with Ava Labs and other financial firms on a proof-of-concept for tokenizing private equity funds.
RWA Tokenization Gains Momentum
The initiative between Citi and SDX comes amidst increased interest in Real-World Asset (RWA) tokenization. Recent weeks have seen significant announcements from major players in both traditional finance and the crypto world. On April 30, BlackRock filed to create a blockchain-based share class for its $150 billion Treasury Trust Fund. On the same day, Libre announced plans to tokenize $500 million in Telegram debt. Dubai also saw a $3 billion tokenization deal involving MultiBank Group, UAE real estate firm MAG, and blockchain provider Mavryk.
Eric Piscini, CEO of Hashgraph, commented on the trend, telling Crypto News Insights, “The recent surge isn’t arbitrary. It’s happening because everything’s lining up.” He pointed to clearer regulations, stronger technology ready for scale, and major players like BlackRock and Citi actively pursuing digital asset initiatives.
Summary: A Step Forward for Digital Finance
The partnership between Citi and SDX marks a significant step in bridging traditional finance with the digital asset world. By tokenizing late-stage private shares on a regulated platform, they aim to unlock liquidity and access in private markets. This collaboration, alongside other recent RWA tokenization developments, underscores the growing momentum towards integrating blockchain technology into mainstream financial operations, potentially reshaping investment opportunities globally.
