Citigroup is launching a new way for institutional and wealthy investors to buy stakes in private companies using blockchain technology as part of a broader push by major banks to bring traditional financial assets into digital asset networks.
The bank on Thursday introduced 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 at a time when 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 equities.
“Our focus with digital depositary receipts is to continue expanding responsible access to digital asset markets,” a Citi spokesperson told CoinDesk.
The product debuted with a transaction involving Kaleido, a digital assets and tokenization company backed by Citi Ventures and investors in Citi’s wealth management business.
The structure is based on depositary receipts, a long-standing financial product that allows investors to gain equity exposure through a security issued by a bank. Citi has adapted that 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 directly own the depositary receipt rather than the underlying shares, while Citi acts as issuer and custodian.
The bank argued that the approach could make private market investing simpler and more transparent than some existing structures, which often rely on special purpose vehicles and multiple intermediaries.
The launch is part of a larger 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.
Supporters say tokenized assets could eventually reduce settlement times, reduce costs and allow markets to operate 24 hours a day.
Citi has been among the banks that have driven that transition. Earlier this month, Citi joined several of the largest US banks in announcing plans to develop a network of shared tokenized deposits through The Clearing House by mid-2027. The system would convert traditional bank deposits into blockchain-based tokens while keeping funds within the regulated banking system.
For now, Citi’s private equity product operates on infrastructure provided by SIX. The bank said it plans to expand the offering over time and eventually support public blockchain networks, which could allow a broader range of investors and institutions to participate.
