- Citibank collaborates with Wellington Management and WisdomTree for a blockchain-based “proof of concept.”
- The experiment involves tokenizing a hypothetical private equity fund on the Avalanche blockchain.
- Fund distribution rules embedded in smart contracts determine token allocation among WisdomTree clients.
- The test explores the use of tokenized assets as loan collateral in automated lending contracts with the Depository Trust & Clearing Corporation’s crypto unit.
- Citibank aims to evaluate results to potentially offer blockchain-based services on Wall Street.
Breaking into Tokenized Securities
In a groundbreaking move, Citibank has entered the realm of tokenized securities on the Avalanche blockchain, aiming to advance the adoption of distributed ledger technology in traditional finance. The multinational financial services giant partnered with Wellington Management and WisdomTree for a “proof of concept” initiative, tokenizing a hypothetical private equity fund on the Avalanche blockchain.
Testing the Waters
The collaborative effort explores the integration of fund distribution rules into smart contracts, determining how tokens are allocated among WisdomTree clients. Additionally, the test examines the viability of using a tokenized private fund as collateral in automated lending contracts with the Depository Trust & Clearing Corporation’s crypto unit. The evaluation of these results will shape Citibank’s decision on potentially offering blockchain-based services in the near future.