Citi, SDX Tokenize Pre-IPO Shares, Boosting $75B Market Liquidity

Switzerland-based SIX Digital Exchange (SDX) and banking giant Citi have joined forces to tokenize unlisted shares, aiming to enhance liquidity in the $75 billion pre-IPO market. This collaboration seeks to address longstanding inefficiencies in the private equity sector by transitioning from slow, paper-based transactions to a fully digitized process. The partnership focuses on late-stage pre-IPO equity markets, leveraging blockchain technology to bring benefits to traditionally disconnected markets with low liquidity.

The initiative involves converting pre-IPO equity holdings into tokenized assets, with Citi acting as the custodian and issuer agent. These tokenized equities will be managed on SDX’s blockchain-based Central Securities Depository (CSD) platform. This shift is expected to streamline transactions, reduce settlement times, and improve transparency, addressing the current challenges faced by investors in the private equity market.

In the third quarter of 2025, a new platform will be launched for the open and secure trading of tokenized equities. Initially, this service will exclude U.S. investors and target the Swiss and Singaporean markets, as well as other Asian regions where demand for blockchain assets is high. SDX’s operations in Asia are part of a broader strategy to capitalize on the growing interest in blockchain technology.

Investors will experience minimal disruption as the new platform allows them to transact tokenized equities seamlessly. The use of blockchain technology ensures secure transactions and provides straightforward solutions, enhancing the overall efficiency of the private equity market. This initiative is part of a broader effort to modernize the financial sector by leveraging digital assets and blockchain technology.

Private equity operations often face issues due to traditional, outdated business processes. Buying or selling private shares involves lengthy PDFs and transaction settlements that can take weeks to months, resulting in poor transparency and inefficiency. Digital Asset Emerging Solutions Lead Nisha Surendran at Citi Ventures highlights that the lack of scalability in private market infrastructure is a significant challenge for investors. SDX’s digital token solutions aim to provide quick fund access to private equity investors, bypassing the delays associated with traditional methods.

The platform utilizes SDX’s blockchain technology through its CSD-based tokenization framework to resolve these concerns. Trading digital tokenized assets on online trading systems delivers improved access compared to traditional private equity markets. This digital future, as envisioned in the recent collaboration, may shape the entire industry’s path forward, paving the way for more efficient and transparent financial transactions.

The agreement between Citi and SDX represents a significant advancement in making real-world assets digital. Through tokenization, private equity markets worth trillions of dollars will become more accessible to a broader range of investors. This process enables more investors to tap into high-growth investment opportunities that were previously out of reach. Private market investors now enter a future that provides market liquidity and full transparency for opportunities that until recently were only accessible to major institutions.

Citi’s Global Head of Digital Assets Nadine Teychenne describes this new initiative as “a joined-up project across multiple businesses” within Citi. Bank officials have shown their dedication to securing regulated digital market access globally through this partnership. The new tokenized platform provides investors with efficiencies while giving them access to greater private equity market liquidity. Digital platforms enable continuous trading through tokenized assets, offering more accessibility and flexibility options than traditional private equity markets.

The blockchain partnership between Citi and SDX represents the beginning of extensive digital change for every segment of the financial sector. This collaboration is expected to set a new standard for the tokenization of private equity markets, enhancing liquidity and transparency while providing investors with more efficient and secure transaction options. As the financial industry continues to evolve, initiatives like this one will play a crucial role in shaping the future of digital assets and blockchain technology.