Citigroup to Launch Tokenized Shares of Anthropic, OpenAI, Ripple

Wall Street giant Citigroup is launching tokenized shares of private companies, which would enable its institutional clients to trade shares of companies such as Anthropic, OpenAI, and Ripple. This comes amid the SpaceX IPO buzz, with investors seeking exposure to the largest private companies before they go public.

Citigroup To Launch Tokenized Shares Of Private Companies

According to a WSJ report, the bank is establishing a way for its wealthy and institutional clients to trade shares of private companies on a blockchain. The bank is also hoping that other banks across Wall Street will adopt this venture.

As part of the move to launch these tokenized shares, Citigroup is already discussing with some of the largest private companies. This venture could provide exposure to companies such as OpenAI, especially with OpenAI CEO Sam Altman’s revelation that their IPO could happen within a year, signaling no rush to go public.

Commenting on this move, Citigroup’s Head of Enterprise Digital Asset, Artem Korenyuk, said that the venture lets clients put private-company shares essentially right next to their Apple stock. He noted that the venture is initially open to only foreign investors, but they plan to make it available to U.S. investors later.

This move comes amid a tokenization boom, with traditional financial (TradFi) giants moving to bring traditional assets on-chain. Notably, the New York Stock Exchange (NYSE) is already working on a 24/7 trading platform for tokenized securities. However, the SEC has so far delayed its guidance on tokenized equities.

How This Venture Will Work

According to the report, Citigroup’s offering of tokenized shares of private companies will work through depositary receipts. These are securities that banks issue to represent shares in foreign companies. The bank will issue these receipts and act as their custodian.

This marks the latest way to gain exposure to private companies ahead of any potential IPO. As CoinGape reported, the crypto prediction market platform Polymarket also launched prediction markets for private companies, allowing retail investors to gain exposure to these companies before they go public. These prediction markets will track these companies’ performance, valuations, and other metrics.

Meanwhile, it is worth noting that this venture from Citigroup comes as banks continue to adopt blockchain technology to offer new services. Citi, JPMorgan, and other banks are also reportedly planning to launch a tokenized deposit system by next year in a bid to deal with competition from crypto firms and stablecoin issuers. JPMorgan already offers its tokenized deposit coin JPM Coin.