Virtu and Tradeweb complete onchain repo using Marshall Islands digital bond

The USDM1 sovereign bond was used as collateral in a repo that settled on the Canton Network in under 10 minutes.

Virtu Financial, M1X Global, and Tradeweb completed an onchain repurchase agreement using a sovereign digital bond as collateral, with the transaction settling on the Canton Network.

The collateral was USDM1, a US dollar-denominated bond issued onchain by the Republic of the Marshall Islands and backed 1:1 by short-term US Treasurys. The bond pays a coupon while serving as collateral and is structured under New York law as a fully collateralized sovereign obligation.

The companies said the transaction was the first repo to combine natively issued sovereign collateral with fully onchain atomic settlement. It was executed between regulated counterparties on Tradeweb, and the repo and repurchase cycle took less than 10 minutes.

USDM1 is available through Tradeweb. Institutional custody is provided by Anchorage Digital, BitGo, and tZERO, according to Cointelegraph.

The transaction represents an early institutional use of tokenized sovereign debt as financing collateral, rather than solely as an asset for issuance or trading.

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