Citigroup is launching a new way for wealthy and institutional investors to buy stakes in private companies using blockchain technology, part of a broader push by big banks to bring 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 shares of private companies through blockchain-based securities issued and held by Citi.
The launch comes as many fast-growing companies wait 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 surged 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 asset and tokenization company backed by Citi Ventures and investors in Citi’s asset management business.
The structure is based on depository receipts, a long-standing financial product that allows investors to gain equity exposure through a bank-issued security. Citi adapted that model for private companies and recorded the effects on the blockchain infrastructure operated by Swiss market operator SIX.
The result is a digital version of a traditional financial instrument. Investors own the certificate rather than the underlying shares directly, while Citi acts as both issuer and custodian.
The bank argued that this approach could make private market investments simpler and more transparent than some existing structures, which often rely on dedicated vehicles and multiple intermediaries.
The launch is part of a larger effort by major financial institutions to tokenize traditional assets.
Tokenization refers to representing real-world assets, such as stocks, bonds or bank deposits, as digital tokens that can move across blockchain networks.
Proponents say tokenized assets could ultimately shorten settlement times, lower costs and allow markets to operate 24 hours a day.
Citi was one of the banks that encouraged this transition. Earlier this month, Citi, along with some of the largest US banks, announced plans to develop a shared tokenized 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 share product runs on SIX’s infrastructure. The bank said it plans to expand offerings over time and eventually support public blockchain networks, potentially allowing a broader range of investors and institutions to participate.