From New York to the World: How Canton Is Building a Second Wall Street

Hwang hyojun(hj) Research Analyst / Xangle Dec 18, 2025 Table of Contents 1. The Influence and Structural Inefficiencies of Global Capital Markets 1-1. Capital Markets as the Core Infrastructure of the Global Economy 1-2. On-Chain Financial Infrastructure as a Path to Greater Market Efficiency 1-3. Why Institutions Still Do Not Use It—Yet 2. How Canton Brings Global Capital Markets On-Chain 2-1. Canton as an Institutionally Adopted Blockchain Network 2-2. For Financial Institutions to Use Blockchain Infrastructure, It Must Be Regulation-Friendly and Privacy-Preserving 2-3. For Real-World Institutional Use, It Must Support Real-Time, Large-Scale Processing 3. Canton as Emerging Institutional Financial Infrastructure 3-1. More Than $6 Trillion in Real-World Assets Are Already Being Processed on Canton Every Month 3-2. Nasdaq and QCP Implement “Real-Time Collateral Movement” on Canton 3-3. Core Wall Street Institutions Are Operating and Governing the Network 3-4.$CC as the Economic Coordination Mechanism of the Network 4. Expanding Access to Institutional Financial Infrastructure 1. The Influence and Structural Inefficiencies of Global Capital Markets 1-1. Capital Markets as the Core Infrastructure of the Global Economy Global capital markets sit at the core of the modern world economy. Corporations and governments rely on them to secure the capital required for long-term growth, day-to-day operations, and infrastructure expansion; investors—ranging from households and pension funds to professional asset managers—seek allocation channels capable of delivering stable and recurring returns. Within this structure, capital markets perform a critical coordinating function: by issuing and circulating financial instruments such as equities and bonds, they connect capital providers with capital demand, channel funds toward productive sectors, and ultimately raise the economy’s overall efficiency and long-term growth potential. MSCI’s Global Market Portfolio estimates illustrate the scale of this system. The size of investable global capital markets expanded from approximately $100 trillion in 2006 to nearly$200 trillion by 2023, effectively doubling over less than two decades. Over the same period, global GDP rose from roughly $55 trillion to around$100 trillion. Although capital market expansion cannot be attributed solely to GDP growth, the underlying feedback loop is evident: financial markets finance corporate investment, expansion, and operational sophistication; those corporate activities feed back into economic growth; and rising economic output, in turn, increases demand for financial assets. Because of this self-reinforcing cycle, capital market size and GDP tend to grow in tandem over the long run—underscoring why global financial infrastructure has become increasingly central to the functioning of the world economy. 1-2. On-Chain Financial Infrastructure as a Path to Greater Market Efficiency Global capital markets have expanded at an extraordinary pace; their underlying operating infrastructure, however, has remained constrained by legacy structures. Traditional settlement and clearing systems rely on layered intermediation involving exchanges, clearinghouses, custodians, and prime brokers. This structure creates complex, multi-step workflows that inherently result in T+1 or T+2 settlement cycles, fragmented account structures, and elevated operational costs. Large minimum ticket sizes and restricted access further narrow the investor base, while jurisdiction-specific regulatory frameworks impose different procedural requirements on identical assets across borders, compounding inefficiency at a global scale. Against this structural backdrop, blockchain-based on-chain infrastructure has emerged as a viable technological alternative. On-chain systems enable operating characteristics that legacy financial infrastructure struggles to support at scale, including real-time settlement, continuous 24/7 markets, programmable financial instruments, a unified global settlement layer, and fine-grained fractional ownership. Processes that previously depended on inter-institutional messaging via SWIFT or DTCC, together with manual reconciliation and off-chain record alignment, can instead be synchronized natively on a single ledger. The implication is not incremental optimization but a structural shift in how markets operate: capital moves faster, transaction costs compress, and market access broadens simultaneously. Market perception around this shift has also begun to change. BlackRock CEO Larry Fink has publicly stated that “tokenization will fundamentally reshape the financial system,” and major financial institutions such as BlackRock, Franklin Templeton, JPMorgan, and HSBC are already tokenizing assets including government bonds, money market funds, deposits, and private assets on-chain. Observed institutional behavior increasingly suggests that on-chain financial infrastructure is no longer viewed as a peripheral experiment, but rather as a foundational layer in the future operating model of global capital markets. 1-3. Why Institutions Still Do Not Use It—Yet Despite the efficiency gains implied by on-chain finance, blockchain technology remains largely confined to pilot-stage experimentation and has yet to establish itself as core operational infrastructure for traditional financial institutions. The underlying constraint is structural rather than conceptual: existing blockchains fall short of the technical and regulatory standards required for institutional deployment. The first hurdle lies in regulatory compliance and data privacy, both of which are non-negotiable requirements for institutional adoption. Banks, broker-dealers, and asset managers operate under strict data governance regimes in which all customer information and transaction records are subject to personal data regulations such as GDPR and CCPA. Account- and identity-level data also fall directly under KYC and AML mandates. Data related to positions, settlement, margin, and capital adequacy is further governed by Basel III and Basel IV, as well as jurisdiction-specific supervisory rules, all of which require stringent controls over security, retention, and access. In public blockchain architectures, where a single global state is shared across the entire network, such sensitive information is exposed to broad visibility. In certain cases, legal and regulatory constraints outright prohibit recording this data on-chain. For this reason, any blockchain infrastructure intended for institutional use must satisfy a distinct set of requirements: Granular visibility controls that prevent customer, transaction, and position data from being exposed to non-relevant participants Privacy-preserving transaction models that allow transparent regulatory audit and verification, while avoiding disclosure of data unnecessary for operational execution A technical architecture capable of simultaneously meeting KYC/AML, market regulation, and capital regulation requirements—covering identifiability, traceability, and data minimization A second constraint is performance. Blockchain infrastructure designed to support inter-institutional financial activity must operate at throughput levels consistent with global financial systems. Global card networks, for example, require thousands to tens of thousands of TPS during peak periods; daily processing volumes at financial market infrastructures such as DTCC and CLS translate into sustained clearing and settlement traffic on the order of 10,000–100,000 TPS when normalized to a per-second basis. Existing blockchains remain far removed from this benchmark. Ethereum processes roughly 15 TPS, Bitcoin approximately 7 TPS, and while newer Layer 1s advertise targets in the hundreds of thousands of TPS, stable performance at that scale has yet to be conclusively demonstrated. A clear gap therefore persists between the throughput demanded by global financial infrastructure and the capabilities of today’s blockchains. Taken together, the conclusion is straightforward. Blockchain infrastructure clearly holds the potential to address structural inefficiencies in capital markets; yet current implementations remain insufficient for real institutional deployment. Regulatory compliance, privacy preservation, interoperability with legacy systems, high-performance throughput, and deterministic finality remain unmet requirements in most existing networks. Only once a finance-native on-chain infrastructure reaches a level of maturity suitable for live institutional operations will large-scale on-chain adoption begin to materialize. The reason this report opens by contrasting the immense potential of global capital markets with the persistent inefficiencies of traditional financial infrastructure lies here. Canton is an institution-grade blockchain designed explicitly to address these two constraints. The sections that follow examine the problems Canton seeks to resolve—and the vision underpinning its attempt to bring institutional financial infrastructure on-chain. 2. How Canton Brings Global Capital Markets On-Chain 2-1. Canton as an Institutionally Adopted Blockchain Network Canton is a Layer 1 blockchain formally unveiled in May 2023 by a consortium of banks, exchanges, technology firms, and infrastructure providers, including Goldman Sachs, BNP Paribas, Cboe Global Markets, and Microsoft. The network was designed and developed by Digital Asset (DA), a specialist in institutional-grade digital asset infrastructure. Canton was architected explicitly to address limitations inherent in public blockchains by offering privacy-driven, customizable network configurations, secure interoperability across institutional participants, and fast, deterministic finality at real transaction scale. Taken together, these characteristics position Canton as infrastructure deployable within live financial operating environments rather than as a purely experimental system. Market confidence in this vision is already visible. Digital Asset, the developer behind Canton, has raised a cumulative 447.2 million from strategic investors such as Goldman Sachs, S&P Global, and Nasdaq Ventures. This level of backing reflects institutional conviction rather than speculative interest. Canton is also active across multiple pilot programs and production deployments, including Broadridge’s Distributed Ledger Repo (DLR) platform and the digital asset networks operated by Goldman Sachs and State Street. These deployments demonstrate applicability beyond proof-of-concept use cases. 2-2. For Financial Institutions to Use Blockchain Infrastructure, It Must Be Regulation-Friendly and Privacy-Preserving Canton addresses the scalability and privacy constraints of existing blockchains through a privacy-first architectural design. Unlike public blockchains, the network does not maintain a single global state shared by all participants. Although Canton presents itself externally as a unified ledger, it operates internally as a virtual global ledger —a structure in which each participant stores and processes only the data relevant to its own interests. The network is composed of three core components: parties, participant nodes, and synchronization domains. Participant nodes serve as the execution layer through which institutions connect to the network and process transactions, while synchronization domains function as a neutral coordination layer responsible solely for message delivery and ordering. Each synchronization domain is further divided into a mediator, which oversees transaction approval, and a sequencer, which assigns transaction order. At the core of this architecture is Canton’s proprietary smart contract language, Daml (Digital Asset Modeling Language). Daml enforces permissions and data visibility at the contract level directly within the language itself. Every contract explicitly specifies its signatories, observers, and actors, and any party not included in this set is unable to view the contract’s contents. Visibility is further differentiated by role, meaning that each participant sees only the subset of information relevant to its involvement. Access rules are therefore embedded at the moment a transaction is created, preventing data from propagating beyond what is strictly necessary. This design choice maps directly to institutional requirements for regulatory compliance and privacy protection. Transaction execution follows a clearly defined process. Each transaction is first fragmented according to Daml’s visibility rules, retaining only the contracts and actions that a given party is authorized to observe. All other components are removed and formed into separate transaction fragments. In an asset swap between two institutions, for example, the full swap contract remains visible only to the two counterparties, while the asset issuer can observe solely whether the contracts it issued have been transferred. These fragments are then encrypted using the public keys of their respective recipients and transmitted to the synchronization domain. Message contents remain opaque at this stage; the sequencer’s role is limited to assigning order and timestamps. Encrypted fragments are subsequently forwarded to participant nodes, where validation is performed locally. Each node verifies that the fragment has been approved by the appropriate signing parties, that the contract state remains valid, and that no double-spending has occurred. Transaction validity is therefore established in a distributed manner by authorized participants, rather than by any centralized authority. Once validation is complete, participant nodes return their results to the synchronization domain. The mediator aggregates these responses and determines final transaction approval, after which an approval message is broadcast back to the nodes. Participant nodes then apply contract consumption or new contract creation to their local state, finalizing the transaction. This architecture ensures that all participants converge on identical execution outcomes, while data is transmitted exclusively to authorized stakeholders. Transactions are defined deterministically in Daml, guaranteeing reproducibility across participant nodes; support for irreversible data concealment further enables compliance with regulatory requirements such as GDPR’s right to be forgotten. Taken together, these design choices allow Canton to satisfy institutional demands for auditability, privacy, and regulatory alignment without sacrificing operational correctness. 2-3. For Real-World Institutional Use, It Must Support Real-Time, Large-Scale Processing Institutional migration of high-load financial activities—credit trading, settlement, and clearing—requires more than conceptual scalability; it demands the ability to process large transaction volumes in real time under continuous operational conditions. Canton addresses this requirement by embedding scalability directly into its architectural design. Three elements are central to this approach: state partitioning with data minimization, parallel execution via synchronization domains, and a low-cost execution model optimized for sustained throughput. The first design choice concerns state management. As discussed in Section 2-1, Canton does not replicate a single global state across all nodes, unlike conventional blockchains. Maintaining a unified global state forces every participant to process every transaction, creating hard scalability ceilings. Canton instead limits data propagation to relevance: each node receives and processes only the data associated with contracts in which it is a direct stakeholder. By constraining execution to economically relevant participants, throughput scales linearly as network activity grows. Parallelism forms the second pillar of scalability. Canton enables concurrent transaction processing through synchronization domains. When load concentrates within a single domain, additional domains can be deployed to achieve immediate horizontal scaling. Participants may connect to multiple domains simultaneously, and transactions assigned to separate domains are processed fully in parallel. Where counterparties share at least one common domain, workflows spanning multiple domains are executed atomically as a single operation. This ability to partition the network for performance while preserving cross-domain consistency represents a defining characteristic of Canton’s design. * Transaction atomicity: A fundamental property of transactions whereby all steps either complete successfully, or the entire transaction fails and is rolled back as if no execution had occurred. Performance is further sustained through a deliberate avoidance of high-cost cryptographic primitives in critical execution paths. Privacy-centric platforms often rely on zero-knowledge proofs (ZK), secure multi-party computation (SMPC), or fully homomorphic encryption (FHE) at the core transaction layer—an approach that inherently constrains throughput. Canton takes a different route. Permissions and visibility are enforced at the transaction level through Daml, allowing sensitive metadata visible to domain operators to be encrypted while protecting transaction contents through the privacy model itself, without invoking computationally expensive cryptography. The result is a lightweight execution path that removes cryptographic bottlenecks and preserves real-time processing capability as the network scales. Source: The Tie Operational data increasingly supports Canton’s scalability claims. Since mid-2024, daily transaction volumes have shown a steady upward trajectory, suggesting that Canton has moved beyond its initial infrastructure build-out and into a phase of sustained institutional usage. As of October 2025, daily transaction counts exceed 600,000, with peak levels surpassing 1 million transactions. Absolute capacity sufficient to absorb the entirety of global financial infrastructure remains a subject for further observation. Nevertheless, the concurrent growth in both TPS and daily transaction volume suggests that network activity is driven not by episodic events, but by continuous and recurring institutional operations. From an infrastructure perspective, this pattern signals that Canton has moved beyond the realm of technical experimentation and into the domain of a public network actively processing institutional financial workflows. 3. Canton as Emerging Institutional Financial Infrastructure 3-1. More Than 6 Trillion in Real-World Assets Are Already Being Processed on Canton Every Month Canton is no longer operating at the level of proof-of-concept deployments. The network is already processing assets and transactions at a scale consistent with real institutional use. The monthly value of on-chain assets processed on Canton exceeds $6 trillion, with daily transaction volumes reaching approximately$300 billion. Much of this activity is driven by Broadridge’s Distributed Ledger Repo (DLR) platform, one of the core infrastructures underpinning the global repo market, which operates directly on Canton and processes repo transactions totaling roughly $4 trillion in value. Concrete evidence of this operational maturity emerged in August 2025, when Tradeweb, one of the world’s leading electronic bond trading platforms, executed an on-chain repo transaction using tokenized U.S. Treasuries and USDC on Canton. Settlement occurred in real time over a weekend, demonstrating continuous, 24/7 funding and settlement capabilities that are structurally unavailable in traditional financial infrastructure. Within the transaction flow, USDC was issued, utilized, and redeemed directly on-network, functioning as immediately deployable digital cash. In parallel, tokenized U.S. Treasuries created and transferred via DTCC affiliates enabled real-time collateral utilization. The transaction is widely regarded as a milestone showing that blockchain-based financial infrastructure has crossed the threshold from experimentation to production-grade deployment within traditional markets. Activity on Canton is not confined to the repo market. Digital bond issuance represents another area where the network has already established a meaningful footprint. In 2024 alone, more than$1.1 billion in digital bonds were issued on Canton. Notable examples include the European Investment Bank’s (EIB) digital bond issuance and real estate portfolio bond offerings led by Black Manta, a digital asset tokenization platform; both implemented directly on the Canton network. Across government bonds, corporate bonds, equities, and real estate, Canton is actively supporting the tokenization, settlement, and trading of real-world assets within live institutional environments. Large-scale transactions are executed daily across institutional networks, indicating not merely theoretical promise, but operational validation of technical reliability and scalability under real market conditions. 3-2. Nasdaq and QCP Implement “Real-Time Collateral Movement” on Canton In June 2025, Singapore-based digital asset trading firm QCP Capital completed a pilot project in collaboration with Nasdaq, implementing margin and collateral management for over-the-counter (OTC) derivatives trading directly on the Canton blockchain. The initiative also involved Primrose Capital Management and Digital Asset, Canton’s developer, and was executed through a direct integration of the Canton network into Nasdaq’s existing market infrastructure, the Calypso platform. The OTC derivatives market has long been constrained by manual and delayed margin call and collateral transfer processes, limiting both scalability and operational responsiveness. The pilot directly targeted these bottlenecks, using on-chain infrastructure to introduce several operational improvements: End-to-end automation of margin calls and collateral posting Continuous, 24/7 collateral workflows Improved transparency via a shared ledger, reducing reconciliation and dispute resolution overhead Flexible collateral movement across traditional financial markets and digital asset markets Taken together, these changes represent a meaningful step toward addressing two persistent institutional challenges: delayed counterparty risk management and inefficient capital utilization. Faster and more consistent collateral movement allows institutions to reduce excess collateral buffers and reallocate capital more productively across portfolios. QCP CEO Melvin Deng characterized the pilot as “a case that goes beyond a simple technical demonstration, highlighting the potential for structural change in capital efficiency.” Following the pilot’s completion, Nasdaq and QCP have begun jointly assessing potential extensions of the model into OTC spot and derivatives trading infrastructure. The same on-chain collateral management framework could also be applied to additional asset classes, including structured credit products and FX-related instruments. At this stage, however, such expansions remain exploratory; no specific product launches or implementation timelines have been disclosed. 3-3. Core Wall Street Institutions Are Operating and Governing the Network Canton’s institutional traction is most clearly visible in the expansion of its validator base. From approximately 24 validator nodes at launch, the network scaled to more than 575 within just over a year, surpassing 600 active validators by late October 2025. This growth reflects more than numerical expansion; it signals adoption of Canton as live financial infrastructure rather than a limited pilot network. Central to this expansion is the direct participation of core global financial institutions as validators. Super Validators include staking infrastructure provider Figment, one of the world’s largest electronic bond trading platforms Tradeweb, as well as Broadridge, Euroclear, Cboe, Paxos, and Microsoft. These entities play an active role in network synchronization, security, and protocol upgrade governance. Alongside them, a broader set of systemically important financial infrastructure providers has joined the Canton network as validator nodes. Viewed collectively, the composition of participating institutions positions the Canton Network as a federated network of global financial hubs. A validator set exceeding 600 nodes strengthens decentralization and security while generating reinforcing network effects: increased institutional participation leads to more applications, which in turn drives higher and more persistent usage. As of October 2025, more than 28,000 wallet addresses are registered on Canton, the majority linked to institutional accounts, asset management services, and trading applications rather than retail experimentation. Operationally, this profile indicates that Canton has moved beyond the pilot phase and into the domain of infrastructure capable of processing live Wall Street transactions on-chain. Continued growth in participating institutions and validator nodes would further amplify these network effects, increasing the likelihood that Canton emerges as one of the most widely utilized Layer 1 platforms for institutional on-chain finance. 3-4. $CC as the Economic Coordination Mechanism of the Network$CC, Canton’s native token, is designed as an operational utility for the network rather than a speculative asset. The token carries an uncapped supply and is issued exclusively through network contributions, with no presale or ICO. New issuance occurs only when Super Validators, Validators, and Application Providers operate Synchronizers or connect applications to the network—establishing $CC as a work-based token minted solely in response to measurable economic contribution. The utility framework is intentionally narrow and explicit.$CC is used to pay Synchronizer usage fees; tokens paid as fees are not recycled into the market but burned in full. Fees are denominated in USD terms, linking burn directly to real network activity: higher usage mechanically increases burn, while periods of lower activity result in issuance outpacing burn and a net accumulation of supply. In parallel, the issuance mechanism functions as a direct incentive for ecosystem participants to operate infrastructure and develop or scale applications. At the current stage, this design introduces clear risks. Initial issuance is front-loaded—20 billion tokens over the first six months following launch, followed by another 20 billion over the subsequent year—placing early supply growth well above that of many comparable protocols. Prior to full network activation, application usage remains insufficient to generate burn at a level comparable to issuance, making a burn–issuance imbalance structurally unavoidable in the near term. On-chain data reflects this imbalance. Daily issuance currently exceeds approximately $3 million, while burn during the same period is limited to roughly$600,000. Short-term price pressure driven by supply accumulation is therefore difficult to avoid. Closing this gap requires a step-change in transaction volumes from real financial applications using the Global Synchronizer—sufficient to allow burn to meaningfully offset issuance. A longer-term inflection, however, remains plausible. Issuance is scheduled to decline over time, while network usage has continued to expand steadily. Under these conditions, burn could eventually exceed issuance, increasing the likelihood of sustainable token economics. Builder activity reinforces this trajectory. Teams such as Temple, developing trading platforms that allow broad access to on-chain financial products, are actively deploying within the Canton ecosystem. Successful adoption of these platforms would accelerate transaction volume growth and, by extension, the pace of token burn. 4. Expanding Access to Institutional Financial Infrastructure Canton stands as one of the most direct and practical efforts to migrate global capital markets into an on-chain environment. For decades, Wall Street, which serves as the operating core of global financial infrastructure, has been built atop closed systems accessible only to a narrow group of institutions. Recent developments suggest that this structure is beginning to shift. As major Wall Street participants start migrating legacy and inefficient infrastructure onto the Canton network, the initiative increasingly reflects the early stage of a structural transition rather than a standalone technological experiment. Viewed through a longer historical lens, the transformation is striking. Wall Street, which emerged from the narrow streets of 18th-century New York, is now being reassembled on a new digital foundation built on blockchain technology at a global scale. Once core trading and settlement infrastructure begins operating reliably on Canton, the network’s role extends beyond that of a conventional blockchain and starts to function as a second Wall Street in operational terms. A further shift warrants attention. Historically, access to the cash flows generated by Wall Street has been tightly restricted. Canton introduces a different participation model. Through the $CC token, individuals can gain indirect economic exposure to the value generated by the network itself. When transactions occur on Canton and Synchronizer fees are burned, the resulting economic effect accrues to$CC holders. A participation structure that was previously unavailable within traditional capital markets is, for the first time, emerging in an on-chain context. Risks nevertheless remain. As discussed earlier, $CC issuance is front-loaded, while network usage has not yet scaled to a level where burn meaningfully offsets issuance. Near-term supply accumulation and associated price pressure therefore remain plausible. Over a longer horizon, however, sustained adoption of Canton as live financial infrastructure, together with rising application usage, could shift the system into a regime in which burn dynamics operate at economically meaningful scale. Within the broader movement toward on-chain capital market infrastructure, Canton offers a new mode of participation for both incumbent financial institutions and individual participants. Wall Street has begun to move; Canton provides the on-chain foundation upon which that movement is being reconstructed. The significance lies not only in technological change, but in the emergence of a structure that, for the first time, allows broad access to the value generated by this transformation. 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Ce n’est pas un conseil financier. DYOR.