RWA goes behind the scenes on Wall Street

(Image caption) The exterior and logo of DTCC headquarters. As the core of the U.S. securities custody and post-trade infrastructure, it is transforming custodial securities into on-chain representations of equity that can be entered into collateral, repurchase and settlement processes.

After assets are put on the blockchain

Over the past few years, the most common news about RWA has been easy to spot: funds being tokenized, US Treasury bonds being moved to the blockchain, large asset management companies announcing the launch of new tokenized funds, and then the market giving an even larger prediction figure.

These developments have driven the market and demonstrated that traditional financial assets can exist in new digital forms. But if we take the question a step further, the answer becomes less clear.

Once an asset is converted into a token, who is responsible for custody? Where is the transaction settled after completion? How are collateral moved? How are dividends, voting rights, and corporate actions handled? When on-chain records conflict with traditional ledgers, which one has ultimate legal effect?

These issues rarely appear in charts showing the RWA market size, yet they determine whether tokenization can truly enter the large financial market.

On July 15, 2026, Depository Trust & Clearing Corporation (DTCC) brought this set of questions into a real production environment.

DTCC announced that the tokenized representation of securities held in custody by DTC has been used in post-trade processes such as U.S. Treasury securities and repos, stock settlement, securities lending, collateralized lending, and central counterparty margin. More than 30 institutions participated in the testing, including BlackRock, Goldman Sachs, JP Morgan, BNP Paribas, State Street, Nasdaq, NYSE, CME, Citadel Securities, Circle, and Vanguard. DTCC plans to officially launch the Tokenization Service in October 2026.

Less than a month later, on August 3, BlackRock launched two tokenized money market products, BSTBL and BRSRV. On August 5, Circle announced the first batch of validators for Arc, including BlackRock, DTCC, ICE, Mastercard, Visa, and Standard Chartered; the Arc public mainnet was scheduled to launch on September 16.

If read separately, these are just three news items from different companies.

When viewed together, the structure that the financial market is building becomes clearer: asset management companies are preparing on-chain cash instruments, securities market infrastructure is beginning to transform post-trade processes, and stablecoin companies are attempting to establish a digital network that can handle assets, currencies, and settlements.

RWA has been talking about "asset on-chaining" for many years, but now it is encountering an even more difficult part - the Wall Street back-end.

(Image caption) The entrance to BlackRock’s headquarters in Hudson Yards, New York. The company provides institutional-grade cash tools to complement on-chain workflows through tokenized money market products such as BUIDL, BSTBL, and BRSRV.

Invisible DTCC

When an average investor buys a stock, the screen quickly displays a confirmation of the transaction. From the user's perspective, the transaction appears to be complete.

The actual process in financial markets is much longer.

Securities need to be settled, cash needs to be moved, ownership needs to be recorded, collateral needs to be allocated, and obligations between counterparties must be confirmed. DTCC and its subsidiaries have long existed in the post-transaction phase.

DTC currently holds assets worth over $114 trillion. These are not newly created digital assets in the blockchain world, but rather stocks, ETFs, and U.S. Treasury bonds that already exist within the U.S. securities system, with full legal rights and market history.

This is also the most noteworthy aspect of the test conducted on July 15th.

DTCC converts its custodied securities into on-chain tokenized representations, or digital twins, and then incorporates these representations into processes such as collective pledge, securities lending, Treasury/repo DVP, stock settlement, and CCP margin. Related tests utilized DTCC's Besu network and Canton Network.

When I was reading the DTC documents, what really stopped me wasn't the $114 trillion, but a rather unassuming word: immobilize .

When a traditional security is converted into a tokenized form, the original asset does not leave DTC. DTC will fix the corresponding position in the existing ledger and then move the on-chain equity representation; when the asset needs to return to its traditional form, the reverse conversion will be completed.

This arrangement is both technical and important.

This is because it illustrates that the RWA system currently being built on Wall Street does not require securities to first leave the existing legal framework. The stock remains within the existing system, the DTC still holds the core records, and shareholder rights are not reinvented simply because the asset has an additional on-chain address.

The changes are concentrated on another layer: how assets can be represented, how they can be mobilized, and whether they can be more quickly integrated into different financial workflows.

Stocks are still under securities law

The early crypto market had a very attractive narrative: private keys represented control, tokens represented assets, smart contracts were responsible for execution, and intermediaries could gradually withdraw.

The current DTC system is much more complex.

On December 11, 2025, the SEC provided the DTC with a No-Action Letter, enabling it to advance tokenized services within the framework of federal securities laws. The pilot program had defined asset scope and timeframes, initially covering Russell 1000 constituent stocks, some major index ETFs, and certain U.S. Treasury securities. Subsequent filings by the NYSE with the SEC also linked tokenized securities trading to the DTC's post-trade infrastructure.

DTC Participants have not disappeared.

Wallets need to be registered, the use of which blockchains requires approval, and participants must still adhere to existing compliance obligations. Dividends, voting, corporate actions, custodial responsibilities, and dispute resolution also remain within the existing securities regime.

Many years ago, when people discussed blockchain finance, they often asked: Do intermediaries still need to exist?

Today, I'm more concerned with another question: which intermediaries are changing their roles?

Securities custodians continue to protect core interests, exchanges continue to organize the market, regulators define legal boundaries, and banks and custodians remain responsible. Blockchain enters the interface between them, attempting to improve asset movement, programmable processing, and connectivity between different systems.

For a financial market that handles huge amounts of assets every day, this evolution may be more realistic than "rebuilding the entire financial system".

Wall Street rarely dismantles a working machine entirely. It typically keeps the market open while replacing parts one by one.

(Image caption) The exterior of the New York Stock Exchange building symbolizes that stocks and bonds still exist within existing securities laws and DTC ledgers. Tokenization does not reinvent shareholder rights, but rather changes how assets are mobilized.

Collateral must first prove its value

If you only look at the stock market from the investor's perspective, the most important actions seem to be buying and selling.

Large financial institutions also handle another massive task every day: getting assets to the right place.

Collateral is the most typical example of this.

A bank may hold $10 billion in U.S. Treasury bonds, but whether these assets can be immediately transferred to another counterparty when margin calls are needed determines how much liquidity value they can provide at that point in time.

The existence of an asset and the immediate availability of an asset are not entirely the same concept.

When introducing Collateral AppChain, DTCC focused on real assets, real workflows, and production infrastructure. Its related work with Chainlink also directly targets 24/7 collateral management.

By July 15, collective pledge, securities lending, Treasury/repo DVP, and CCP margin had all entered production testing.

These terms may sound distant to the average investor, but they actually address a very traditional financial question: whether an existing asset can be readily available when the market needs it.

This is also the set of data I most want to track when measuring the development of RWA in the future.

The market can continue to tally the total amount of assets on the chain, but that number can only answer how many assets have been tokenized, not how many of them have actually been used.

More important indicators should include: how long it takes for collateral to move between different accounts, how much less idle assets a bank can prepare as a result, whether the operating costs of repo and securities lending have decreased, and whether capital requirements can be effectively reduced.

Only when this step is reached does tokenization begin to appear on the profit and loss statements of financial institutions.

BlackRock replenishes on-chain cash.

If stocks, government bonds, and collateral all start entering on-chain workflows, the market will soon encounter a very common problem: how to manage the money.

Financial institutions cannot simply hold risky assets. They need a large number of near-cash instruments every day to manage liquidity, earn low-risk returns, meet margin requirements, and handle reserves.

BlackRock is bringing its familiar money market fund business into this environment.

By 2024, BUIDL had become one of the most representative products in the institutional RWA market. On August 3, 2026, BlackRock launched BSTBL and BRSRV.

BSTBL is increasing its Ethereum tokenization share in the BlackRock Select Treasury Based Liquidity Fund, with BNY acting as the transfer agent and tokenization provider. BRSRV, on the other hand, targets digital-native institutions more directly, with Securitize handling the transfer agency and tokenization services. Its product design includes daily dividend reinvestment, multi-chain usage, and stablecoin reserve management.

When launching these two products, BlackRock mentioned that the assets under management of U.S. money market funds have exceeded $8.4 trillion.

I'd rather see this figure of $8.4 trillion than another prediction of "how many trillion dollars RWA will reach by 2030".

The reason is simple. Money market funds are a mature, existing market. They have real customers, real cash flow, real regulation, and daily liquidity needs.

BlackRock is not creating new demand. It is preparing another version of the delivery method: if stablecoin issuers, banks, funds and other institutions need to hold cash alternatives on-chain in the future, BlackRock hopes they will still use BlackRock's products.

This strategy is easy to understand and is very much in line with the behavior of large asset management companies.

(Image caption) Circle CEO Jeremy Allaire attended the event. Arc Network plans to integrate DTCC tokenized assets and stablecoin settlements, attempting to take over the digital layer of assets, currencies, and post-transaction processes.

Time difference between Arc and DTCC

When Circle announced Arc's first batch of validators on August 5, the list easily attracted attention.

BlackRock, DTCC, Galaxy, Global Payments, ICE, Mastercard, MoneyGram, SBI Group, Standard Chartered, Sumitomo Corporation, and Visa are among the companies represented. Circle stated that BlackRock, BNY, DTCC, and Standard Chartered are exploring various integrations related to tokenized asset settlement, digital asset custody, stablecoins, forex, and repos. The Arc public mainnet is scheduled to launch on September 16th.

However, if we set aside the list of institutions, the timeline may provide more information.

Circle disclosed that DTCC plans to tokenize DTC-custodied assets on Arc, with a timeline in the second half of 2027.

Looking at DTCC's own deployment, the order is even clearer.

In October 2026, DTCC will officially launch its own Tokenization Service plan, with the current core path involving Besu and Canton; in the first half of 2027, DTCC plans to integrate DTC tokenized assets with Stellar; Arc is scheduled for the second half of 2027.

This timeline reveals a strategy that is even more worthy of study than "DTCC joining Arc".

DTCC does not appear to be prepared to stake the core U.S. securities infrastructure on a single blockchain.

Besu, Canton, Stellar, and Arc all have their place. What truly needs to be aligned in the future may not be the underlying network, but rather the securities rights recorded by the DTC.

If this path continues, the next problem in the RWA market will be very specific: when the same security appears on different networks, who ensures that it still represents the same legal rights?

This is an interoperability issue, and also a market structure issue.

Regulation is within the system.

The SEC and DTC's participant system, the NYSE's regulatory filing requirements, wallet access, and blockchain network requirements are not additional restrictions on this technology.

They are an integral part of the system design.

The reason is not hard to understand.

If the wallet key is lost, do investors still own the shares?

If the custodian goes bankrupt, what asset category will the on-chain tokens fall under in the bankruptcy proceedings?

How are on-chain rights synchronized when a company pays dividends, votes, merges, splits, or delists?

If there is a discrepancy between the blockchain record and the DTC ledger, which record has the final legal effect?

Smart contracts can execute transaction conditions, but they cannot create their own bankruptcy laws.

Distributed ledgers can record the time and content of transactions, but they cannot decide for themselves which of two creditors will be paid first in court.

This is why I always keep my distance from descriptions like "blockchain will eliminate financial intermediaries".

A more likely outcome is that some tasks will be automated, some intermediary functions will be reduced, and other institutions that hold core rights records and legal responsibilities will become more important.

DTC currently appears to be in that position.

(Image caption) The skyline of Hong Kong's International Finance Centre. In contrast to the US approach of using the existing DTC custody system as an entry point, Hong Kong's Project Ensemble focuses on how tokenized assets and digital currencies can enter the same settlement environment.

Another answer from Hong Kong

If we shift our focus away from the United States, the development of RWA becomes even more interesting.

The Hong Kong Monetary Authority's Project Ensemble has entered the EnsembleTX phase and will continue to process transactions between real-value digital assets and tokenized deposits in 2026. Its testing includes tokenized money market funds, interbank liquidity management, and digital asset settlement, with plans to gradually introduce tokenized central bank money in the future.

Hong Kong has previously tested tokenized deposits, digital bonds, money market funds, and cross-bank treasury management; government-issued tokenized green bonds and multi-currency digital bonds have also brought the connection between the legal, securities, and monetary systems into the real market ahead of schedule.

The most powerful entry point for the United States at present is the existing securities depository and post-trade framework of the DTC.

The Hong Kong experiment focuses on another question: if assets are tokenized, can the currency be simultaneously integrated into the same digital environment?

Neither route has yet reached a stage where a winner can be declared.

But they provide a good window for global comparison.

New York, Hong Kong, Singapore, Europe, and the Middle East may not establish the exact same RWA regime. Different financial centers may develop different custody models, monetary arrangements, blockchain architectures, and regulatory boundaries.

Ultimately, what determines which model is more viable may not be the preferences of the tech community, but rather trading volume, liquidity, legal certainty, and cost.

Blockchain is just one layer

BlackRock manufactures financial products.

BNY and Securitize provide some of the transfer agency, custody, and tokenization services.

DTC maintains a record of core equity holdings in securities.

DTCC integrates assets into clearing, collateral, and post-trade systems.

Circle is attempting to offer stablecoin with a new settlement network.

Exchanges are responsible for forming markets, while the SEC and other regulatory agencies define the legal boundaries.

By placing these institutions on the same diagram, blockchain does not replace the entire diagram.

It lies between them.

A few years ago, the RWA market easily focused on the blockchain itself. Today, the blockchain may just be one component in the overall transformation of the financial market.

And it's probably not the most difficult one.

The real difficulty lies in ensuring that an asset protected by securities laws and held in custody by traditional markets still represents the same right to all participants after passing through different networks, accounts, and collateral statuses.

If a U.S. Treasury bond is used for margin calls at 2 a.m., enters the repo in the morning, and is transferred back to the traditional ledger in the afternoon, someone must know who it belongs to, who it is pledged to, and who has priority at each point in time.

Financial markets can accept different technical architectures.

It cannot accept different ownership answers.

September and after October

On September 16, Circle plans to open the Arc public mainnet.

In October, DTCC plans to officially launch its Tokenization Service.

After these two dates, RWA will need a new set of research methods.

I will start to focus on how many DTC Participants actually register wallets, how many stocks and bonds are converted into tokenized entitlements, and how much of these assets actually go into collateral, repo, and securities lending.

More important figures will appear on the financial institutions' own cost statements: how much the collateral dispatch time has been shortened, how much capital has been reduced, and how much post-transaction operating costs have decreased.

There is another question that few people can answer completely nowadays.

If a single DTC custodian security can appear simultaneously on Canton, Stellar, Arc, or even more networks in the future, how can the market ensure that each chain is still seeing the same security rights?

These answers do not exist yet.

Therefore, I am not in a hurry to conclude that "the revolution has arrived" for RWA in 2026.

In financial history, many technologies that were announced with great fanfare have ended up leaving only a few products; there are also some back-end modifications that were initially almost ignored, but which, a few years later, became the infrastructure that the entire market relies on every day.

It's too early to say what the outcome will be for the DTCC transactions on July 15th.

But at least one thing has changed our perspective on RWA.

A few years ago, we were on the asset issuance side, watching how a fund was turned into a token.

Now we can take a few more steps after the transaction is completed and go into the back-end, which is almost invisible to ordinary investors, to see exactly how stocks, government bonds, cash, and collateral move.

DTCC has always been there.

If RWA eventually becomes part of the financial markets, it will likely have to go through that room first.

Disclaimer

This article is based on publicly available information for financial research and institutional analysis, and is for informational and research purposes only. It does not constitute any investment, legal, tax, or trading advice. The regulatory and market environment for digital assets and tokenized securities continues to evolve, and readers should verify the information and carefully assess the associated risks.