BNY Mellon has accelerated its timeline for implementing 24/7 U.S. Treasury settlement by 2027, launching tokenized Treasuries and blockchain pilot by 2026 end. According to the latest reports from Bloomberg, the bank is responding to the digital asset market's impact on traditional finance. The bank will begin testing tokenized Treasuries on a private blockchain by year-end and will extend its existing settlement network later this year to cover more of the Asian, European and U.S. trading days. This initiative represents a significant step toward eliminating the weekend lag that currently affects U.S. Treasury markets, with the bank now targeting 24/7 settlement for both traditional and tokenized Treasuries by 2027. The move comes as financial institutions increasingly explore tokenisation, with the value of tokenised real-world assets having risen more than fourfold since 2025 to approximately $35 billion, according to rwa.xyz data.
The bank's plans follow the successful completion of an after-hours trade involving the reserves of 2 stablecoin issuers. The earlier transaction involved Ripple's RLUSD and OpenEden's USDO with Ripple participating directly, while BNY's cash-management business unit Dreyfus acted for OpenEden. Tradeweb handled the trade after Fedwire Securities had stopped processing secondary-market Treasury transfers for the day, and the securities were settled shortly afterward through existing cash rails, as reported by Bloomberg. The test demonstrated that Treasury activity tied to stablecoin reserves could continue after the main U.S. settlement window closed, with the transaction taking place after the close of the Federal Reserve's Fedwire securities service. In a letter to clients signed by four senior executives, BNY stated that the transaction "demonstrates that Treasury market activity related to the digital asset ecosystem can continue beyond traditional cutoff times."
The test demonstrated that Treasury activity tied to stablecoin reserves could continue after the main U.S. settlement window closed. RLUSD and USDO hold short-dated government debt as reserve assets, with the tokens trading continuously but the Treasuries behind them remaining tied to weekday settlement windows. This can delay reserve adjustments following large creations, redemptions or collateral calls. BNY is already the primary custodian for RLUSD's reserves and provides custody and investment management for OpenEden's tokenized Treasury fund. The initiative reflects the growing importance of US government debt to digital-asset markets, with stablecoins and tokenised Treasury funds commonly investing in short-dated government securities while the crypto markets in which they operate trade continuously. Ripple welcomed the development, with Senior Vice President of Stablecoins Jack McDonald marking the milestone on X: "Excited to be partnering together as $RLUSD helps support the evolution toward always-on Treasury markets."
BNY Mellon has already introduced tokenized deposit balances in January, giving institutional clients an on-line representation of commercial-bank money. The bank currently processes around $2.5 trillion in payments each day across its payment networks and supports average daily clearance of approximately $24.3 trillion. The bank's initiative represents a significant advancement in financial market infrastructure, potentially reducing settlement delays and improving liquidity accessibility for institutional clients. BNY plans to begin expanding its existing settlement infrastructure for securities eligible for settlement through Fedwire later this year, with the longer-term goal of supporting activity across US, European and Asian trading hours. The development comes as proponents argue that tokenised markets could enable faster settlement, continuous trading and lower transaction costs, though critics remain sceptical about whether the technology can address shortcomings that existing market infrastructure cannot already solve.
