Citigroup is launching a new way for wealthy and institutional investors to acquire stakes in private companies using blockchain technology as part of a broader initiative by big banks to integrate traditional financial assets onto digital asset networks.
The bank on Thursday unveiled what it called Digital Depositary Receipts, a product that allows investors to gain exposure to private company stocks through blockchain-based securities issued and held by Citi.
The launch comes as many fast-growing companies are waiting longer to go public, leaving investors with fewer ways to access sought-after private companies. At the same time, demand for private market investments has increased as investors look for opportunities beyond public stocks.
“Our goal with Digital Depositary Receipts is to continue to expand responsible access to digital asset markets,” a Citi spokesperson told CoinDesk.
The product debuted with a transaction involving Kaleido, a digital asset and tokenization company backed by Citi Ventures and investors in Citi’s wealth management business.
The structure is based on certificates of deposit, a long-standing financial product that allows investors to gain exposure to stocks through a security issued by a bank. Citi adapted this model for private companies and registered the securities on the blockchain infrastructure operated by Swiss market operator SIX.
The result is a digital version of a traditional financial instrument. Investors own the depositary receipt rather than the underlying shares directly, while Citi acts as both issuer and custodian.
The bank argued that this approach could make investing in the private market simpler and more transparent than some existing structures, which often rely on special purpose vehicles and multiple intermediaries.
The launch is part of a broader effort by major financial institutions to tokenize traditional assets.
Tokenization refers to the representation of real-world assets such as stocks, bonds or bank deposits as digital tokens that can move across blockchain networks.
Proponents say tokenized assets could potentially reduce settlement times, reduce costs, and allow markets to operate 24 hours a day.
Citi is one of the banks that has pushed this transition. Earlier this month, Citi joined several of the largest U.S. banks in announcing plans to develop a shared token deposit network through The Clearing House by mid-2027. The system would convert traditional bank deposits into blockchain-based tokens while keeping the funds within the regulated banking system.
For now, Citi’s private sharing product runs on infrastructure provided by SIX. The bank said it plans to expand its offering over time and ultimately support public blockchain networks, potentially allowing a wider range of investors and institutions to participate.
