HONG KONG/SINGAPORE/LONDON/NEW YORK – Citi Securities Services today announced that it has become the first digital custodian participant of BondbloX Bond Exchange (BBX), the world’s first fractional bond exchange using the latest in distributed ledger technology.
BBX was launched in 2020 to simplify bond investing by allowing investors to track and trade bonds electronically. The launch was seen as a significant leap forward in revolutionizing bond trading, making it more accessible to a broader range of investors by fractionalizing full-sized bonds and bringing many of the benefits of equities trading to the bond market, in terms of improved access to the exchange trading of bonds and now the provision of settlement and custodial services in the BBX market.
The partnership with Citi allows Citi’s clients that meet certain criteria, to become BBX participants and begin trading bonds (both fractionalized and full-sized) almost immediately, with Citi providing seamless settlement and custody services at the back end.
Citi was initially chosen by BondbloX in 2021 to act as custodian for the underlying bonds issued and traded on its exchange as fractionalized assets (called “BondbloX”). The recent extended relationship unlocks additional opportunities and benefits for Citi’s clients as well as other BBX participants. In addition to benefiting from the services of a digital custodian, participants gain wider access to the global bond market enabling greater diversification of their investment portfolios, and immediate, atomic settlement at the point of trade execution.
“The decision to partner with Citi was an easy one, given their reputation as a leading securities services provider and our history of collaboration,” commented Dr. Rahul Banerjee, CEO and Co-Founder of BondbloX. “This partnership will enable Citi’s clients and others to enjoy the full benefits of bond trading, coupled with Citi’s securities services support, almost immediately. Digital Custody is the next big step in the transformation of the bond market, making bond markets, more transparent, electronic and accessible to all. Now, bonds are more easily accessible to everyone.”
“Today’s announcement demonstrates our commitment to investing in the future of digital financial market infrastructure (FMI) by building products and services to support the current and future needs of our clients,” stated Matthew Bax, Global Head of Custody for Citi Securities Services. “We are committed to partnering with BondbloX on their journey to transform and simplify bond trading and investing.”
“This proprietary digital custody technology is scalable and will allow us to provide settlement and custody services for clients investing in assets issued on permissioned blockchain networks and digital FMIs. It enables Citi to connect to newly permissioned networks as they emerge and provide a fully consolidated custody service through a single operating model,” said Nadine Teychenne, Head of Digital Assets for Citi Securities Services. “To develop this service, we leveraged our expertise in exchange-traded settlement and custody services which we provide today in around 70 FMIs globally.”
With approximately USD$27.8 trillion1 assets under custody, administration and trust worldwide, and a leading proprietary network spanning more than 60 markets, Citi Securities Services provides cross-border support for clients with extensive on-the-ground local market expertise, innovative post-trade technologies, customized data solutions, and a wide range of securities services solutions that can be tailored to meet clients’ needs.
Citi continues to develop digital asset solutions, in line with its goals and risk appetite, using a unified set of shared technology capabilities and a common strategic approach. These innovative solutions enhance Citi’s products and services including digital money, trade, securities, custody, asset servicing and collateral mobility.
Citi is a preeminent banking partner for institutions with cross-border needs, a global leader in wealth management and a valued personal bank in its home market of the United States. Citi does business in nearly 160 countries and jurisdictions, providing corporations, governments, investors, institutions, and individuals with a broad range of financial products and services.
Founded in 2016, we are a team of debt capital market bankers and technologists, spread across Singapore, India and Mexico, working to realize one vision - provide easy access to bonds for all investors. The BondbloX Bond Exchange is the world’s first fractional bond exchange, regulated as a Recognized Market Operator by the Monetary Authority of Singapore. We are backed by Citi and MassMutual Ventures as investors. Additional information may be found at https://bondblox.com/
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1As of 30 June 2023