Citibank predicts tokenized securities will reach 5.5 trillion by 2030, with Wall Street's core infrastructure fully on-chain

When depository trusts and clearing companies (DTCC) announced they would launch tokenized securities trading in July 2026, Nasdaq is building a framework for blockchain-based stock issuance, and Intercontinental Exchange is planning tokenized stocks—tokenization is no longer a concept requiring validation but a timetable already in the execution phase.

Citibank's pre-Event of Talk in Paris released the report "Tokenization 2030: Wall Street's On-Chain Investment," which provides a magnitude estimate for this transformation: the current global tokenized securities market size is about $17 billion, projected to grow to $5.5 trillion by 2030. Depending on adoption speed, a conservative scenario is $2.7 trillion, and an optimistic scenario could reach $8.2 trillion.

This forecast is worth serious consideration not because the numbers are large enough but because the three driving factors it relies on—transformation of core financial market infrastructure, scaling of compliant stablecoins as settlement media, and substantial progress in US federal securities token legislation—have all moved from discussion to implementation within the past six months. Tokenization is shifting from "can we do it" to "who does it first, how, and how big."

Behind the $5.5 Trillion Prediction: Why Public Market Assets Are Becoming the Main Battlefield for Tokenization

The $5.5 trillion baseline scenario from Citibank is based on a key structural judgment: the first wave of large-scale tokenization will focus on the most liquid, transparent, and frequently settled public market assets—centered on US Treasuries and publicly traded stocks—rather than the previously popular alternative assets like private equity, real estate, or commodities.

This judgment clearly diverges from earlier industry narratives. In recent years, the story of tokenization has focused more on "making illiquid assets tradable," with the logic starting from mapping private credit, private equity, art, real estate, and other low-liquidity assets onto the chain, releasing liquidity premiums through fragmentation and secondary markets. But Citibank's model shows that this path is unlikely to achieve large-scale breakthroughs before 2030—its report estimates the global tokenization scale of private credit and private equity combined at only about $100 billion, less than one-fifth of the public market tokenization scale.

This involves not just technical feasibility but also fundamental differences in market microstructure. Public market assets have standardized issuance formats, mature pricing mechanisms, established market makers, and clear legal rights—tokenization for these assets is more about efficiency upgrades in settlement and custody layers rather than building market infrastructure from scratch. Conversely, private assets rely on complex contractual rights, valuation based on non-public information, and bilateral negotiations—mapping on-chain can only address registration issues but cannot automatically resolve the deeper liquidity matching conflicts.

Citibank's quantitative path is also quite specific: by 2030, 10% of the US Treasury market and 3% of the US public stock market will be tokenized. The demand from stablecoin issuers to buy bonds will create about $1 trillion of new on-chain US Treasuries, and if 10% of ordinary US investors switch to digital trading platforms, it will generate about $2.6 trillion in tokenized stock demand. This logical chain indicates that the first round of incremental growth in tokenization will not come from expanding asset types but from reallocating the same types of assets across different infrastructures.

From a market structure perspective, this means that early impacts of tokenization on capital markets are not about "creating new assets" but about "restructuring how existing assets are held and circulated." Treasuries and stocks remain Treasuries and stocks, but their settlement cycles, custody levels, programmability, and collateral reuse efficiency will undergo substantive changes. For intermediaries relying on settlement cycle arbitrage, custody tier spreads, and collateral scarcity premiums, these changes will directly challenge their business models.

DTCC and Nasdaq Enter the Scene: Why Market Infrastructure Is a Turning Point

Citibank describes the significance of DTCC and NYSE bringing tokenization into capital markets as a "turning point," a characterization worth unpacking.

DTCC is the core clearing and settlement infrastructure for the US securities market, responsible for centralized custody and post-trade processing of US stocks, corporate bonds, municipal bonds, mortgage-backed securities, and more, with annual transaction processing exceeding $2 quadrillion. In May 2026, DTCC announced it would begin limited tokenized securities trading in July and fully launch the platform in October. This timetable means tokenized securities will enter the nationwide clearing network directly connected to NYSE, Nasdaq, and others, no longer relying on independent on-chain trading platforms or broker-dealer self-built systems.

Nasdaq's move goes even further. Nasdaq is not only building a framework allowing companies to issue blockchain stocks but has also received regulatory approval to issue and trade certain stocks digitally, potentially launching as early as 2027. Intercontinental Exchange's NYSE has also announced plans for tokenized stock issuance.

The synchronized advancement of these three infrastructure players changes the competitive landscape of tokenization. Previously, tokenization was mainly driven by native crypto institutions, with trading occurring in relatively closed on-chain ecosystems isolated from mainstream liquidity pools of traditional capital markets. The integration of DTCC and exchange systems means the same security could exist both in traditional ledger systems and blockchain ledgers, requiring interoperability between their clearing and settlement channels. This is the core feature of the "parallel operation" phase described by Citibank.

Citibank uses the analogy of electronic toll collection on highways: toll roads do not eliminate cash lanes overnight but retain both cash and electronic toll lanes for a long period, making the system more complex until the transition is complete. For current capital markets, DTCC's limited tokenized trading, Nasdaq's framework, and exchange pilot programs are all in the stage of "widening roads and laying parallel lanes."

However, this parallel phase also creates new competitive dimensions. Custodian banks capable of managing both traditional securities ledgers and on-chain token ledgers, broker-dealers connecting DTCC clearing systems with on-chain settlement protocols, and market makers providing liquidity in both environments will gain structural advantages during this period. Citibank refers to these as "structural coordinators."

Stablecoins as Settlement Layers: The Reinforcing Logic of On-Chain US Treasuries and Compliant Stablecoins

Tokenized securities moving from registration to real-time trading face a core bottleneck: not the on-chain representation of assets but the settlement at the payment end. Traditional securities trading relies on interbank payment systems and central counterparty clearing, with settlement cycles typically T+1 or T+2. In an on-chain environment, if the payment side still depends on traditional bank transfers, the efficiency advantage of tokenization is nullified.

The scaling of stablecoins solves this bottleneck. Citibank estimates that by 2030, the market size of standard stablecoins will grow to $1.9 trillion, working in tandem with digital bank deposits to enable instant on-chain exchange of assets and cash. This means that both parties can complete asset delivery and payment settlement within the same block, reducing counterparty risk exposure from two days to minutes.

A deeper structural change is the reinforcing relationship between stablecoins and US Treasuries. Issuers of compliant stablecoins typically back them with highly liquid assets, with US Treasuries being the most important component. As stablecoin scale expands, issuers need to continuously buy more US Treasuries to meet reserve requirements. Citibank predicts this will create about $1 trillion of new on-chain US Treasuries demand. Meanwhile, these purchased Treasuries can themselves be tokenized into on-chain Treasury tokens, further enriching the on-chain collateral ecosystem.

This macro cycle has significant implications. The combination of on-chain Treasury tokens and compliant stablecoins effectively constructs a risk-free, dollar-denominated interest rate benchmark operating on blockchain, with settlement efficiency surpassing traditional interbank markets. For overseas small and medium institutions and retail investors who previously found it difficult to access US Treasuries directly, this channel lowers entry barriers and holding costs, potentially attracting new funds into the US Treasury market and marginally strengthening the dollar’s position in the global digital financial system.

From a liquidity perspective, the tokenization of Treasuries not only creates new demand but also improves collateral circulation efficiency. In traditional repo markets, the same Treasury can only circulate within one collateral chain at a time. On-chain programmable collateral can enable atomic reuse across multiple scenarios, releasing significant liquidity currently locked in clearing guarantees. This will have systemic impacts on market makers’ risk management, broker-dealers’ balance sheets, and overall market funding costs.

The Progress of the "Clear Act" and Regulatory Certainty: The Final Step for Institutional Entry

If infrastructure and settlement tools solve the technical feasibility, then regulatory certainty addresses the compliance feasibility. For US institutional investors managing trillions in assets, entering any new asset class requires clear legal authorization and compliance pathways.

On May 14, 2026, the US Senate Banking Committee passed the "Clear Act" with a bipartisan vote of 15-9, ending a four-month deadlock and moving the bill to a full Senate vote. Once enacted, it will provide a unified federal legal framework for the issuance, custody, trading, and investor protection of digital asset securities.

The significance of this bipartisan vote is more about signals than specific provisions. In recent years, US digital asset legislation has repeatedly stalled in Congress, with core obstacles not technical but political—party divisions have tied crypto issues into broader political struggles. The 15-9 vote, with some Democrats and Republicans voting together, indicates diminishing political resistance. For securities tokens closely aligned with traditional financial regulation, legislative progress has become a higher priority.

From an institutional perspective, increased regulatory certainty will directly alter risk-reward calculations. In the gray regulatory area, even if market infrastructure is ready, compliance departments may remain cautious about engaging in tokenized securities due to regulatory uncertainty, which could translate into unquantifiable legal and reputational risks. Legislation will convert this uncertainty from "whether compliant" to "how to comply," providing a clear path for institutions to develop internal controls and operational procedures.

Citibank explicitly lists regulatory clarity as a core driver, reasoning that technology and infrastructure are already in motion, and the regulatory gear's engagement determines the system's maximum speed.

Market Structure Rebuilding: Liquidity, Pricing Power, and the Rise of "Structural Coordinators"

Combining the previous logical chains, a picture of evolving market structure begins to emerge.

First is the clearing and settlement layer. DTCC's integration with tokenized trading and stablecoins enabling real-time settlement will gradually reduce margin requirements and counterparty risk under traditional T+1/T+2 cycles. This benefits broker-dealers’ balance sheet management but narrows profit margins for intermediaries relying on settlement cycle arbitrage and intraday liquidity matching. The efficiency gains in settlement also mean a decline in the added value of settlement services.

Second is the issuance and underwriting layer. Once Nasdaq's on-chain stock issuance framework is operational, companies could bypass some traditional underwriting processes and directly issue securities to qualified investors via tokenization. The value of investment banks in underwriting will shift more toward distribution networks and pricing capabilities rather than issuance channels, forcing banks to redefine their position in the value chain.

Third is custody and asset management. When the same security exists both in DTCC's central custody system and multiple blockchain ledgers, the role of custodians will shift from sole asset safekeepers to cross-system coordinators. Institutions capable of providing unified on-chain/off-chain custody interfaces, handling private/public key mappings, and managing chain-specific events like forks and airdrops will gain competitive advantages.

More importantly, the transfer of pricing power is significant. In a tokenized environment, higher on-chain collateral transfer efficiency and lower market maker capital costs could narrow bid-ask spreads and increase market depth. Competition among liquidity providers will shift from capital size to technological efficiency—those best managing on-chain collateral and cross-system liquidity will hold pricing advantages.

The so-called "structural coordinators" mentioned by Citibank are large banks and investment firms controlling physical asset entry points, digital fund channels, and compliant custody licenses. During the transition period of parallel traditional and on-chain systems, these institutions can complete asset creation, payment settlement, and custody within their closed networks, gaining flow control and pricing influence. This view contrasts with early narratives of de-intermediation—tokenization does not eliminate intermediaries but redefines their value sources. ###