In conjunction with Wellington and WisdomTree, Citigroup Inc. conducted a trial involving the tokenization of private funds using blockchain technology. This initiative aimed to showcase how blockchain networks can tokenize private equity funds, with the potential for broader adoption of distributed ledger technology by Wall Street pending successful A/B testing.

Chainlink, a decentralized blockchain oracle network provider, partnered with SWIFT, an interbank messaging service, in mid-2023 to establish a connection to Sepolia, a well-known Ethereum testnet. This collaboration supported the tokenization testnet.

Within two months of launching their new Cross-Chain Interoperability Protocol (CCIP), a blockchain communication network akin to Swift, the two entities successfully transferred tokenized assets between the testnet and other blockchains. The focus of these experiments was on tokenization, which involves integrating blockchain networks with traditional financial assets.

Citi Bank, a global financial leader, is currently collaborating to develop a cash management solution that offers liquidity to corporate clients through an uninterrupted infrastructure operational 24/7, 365 days a year. In a recent interview with Chainlink, Ryan Rugg, head of digital assets for Citi’s TTS division, disclosed the bank's ongoing efforts to implement blockchain services and integrate tokenization into the private market.

Rugg expressed enthusiasm about blockchain technology being recognized as essential in achieving Citi’s objective of customizable currency. He highlighted two current solutions offered by Citi to its clientele: City Token Services for trade transactions and City Token Services for cash transactions.

Citi Treasury and Trade Solutions (TTS) offer clients a range of digitally enabled treasury, trade, and liquidity management solutions. Citi operates the private/permissioned blockchain technology, allowing customers to utilize its services without hosting a blockchain node.

These solutions complement Citi's portfolio, which includes asset servicing, digital currency, collateral mobility, trade, securities, and custody. TTS is renowned for providing tailored trade finance and cash management solutions, backed by advanced technological infrastructures and banking authorizations across more than ninety countries.

By presenting investors with private assets in innovative digital formats, traditional partnerships and Digital Ledger Technology (DLT) will assist additional banks and financial institutions in meeting complex legal and regulatory requirements. However, banks must ensure thorough regulatory and legal compliance assessments for end-to-end data records, servicing processes, digital identity options, and tokenized cash transactions before final settlement.