S&P Dow Jones Indices and Kaiko said on October 13 that they enabled the first on-chain OTC swap to reference a fully tokenized index, executed by DRW and Marex on Derivnex.
The swap was a total return swap on the S&P DJI iBoxx USD Liquid Investment Grade Index. Kaiko tokenized the index on Canton, a privacy-enabled distributed ledger infrastructure. The token combines the benchmark data with access permissions and usage rules intended to preserve S&P DJI’s licensing and intellectual-property controls. Kaiko distributed the signed official index values that Derivnex used to value the position throughout its lifecycle.
The announcement does not state the notional size of the swap, the maturity date, or the names of any additional counterparties. It describes the trade as a completed transaction between DRW and Marex on the Derivnex platform.
How the trade was represented on Canton
The trade was represented on Canton as a smart contract containing the transaction terms. The companies said the smart contract was designed to remain with the trade throughout its lifecycle. Derivnex incorporates the Common Domain Model, a standardized digital representation of derivatives transactions and lifecycle events developed for the institutional derivatives market. The platform is built on Canton and is designed to allow bilateral OTC counterparties to coordinate transaction workflows while maintaining confidentiality of the trade details from parties that are not involved in the transaction.
George Harrington, CEO of Derivnex, said, “OTC derivatives are one of the largest markets in institutional finance, but much of the infrastructure supporting them remains fragmented. Derivnex gives counterparties a common digital representation of a trade from affirmation through its full lifecycle. Completing the first OTC swap on Canton shows how that model can work in a live institutional market.”
The companies said the combination of the tokenized benchmark and the smart-contract representation allows the index values used for valuation to be distributed under the same controlled conditions that govern the trade itself. Kaiko’s role was to distribute the signed S&P DJI official index values. Those values are the inputs Derivnex used to mark the position to the benchmark during the life of the swap.
What the companies said about the benchmark and licensing
Cameron Drinkwater, Chief Product Operating Officer at S&P Dow Jones Indices, said the transaction shows how established benchmark infrastructure can support new institutional market structures. “Pairing a flagship index with controlled digital distribution through Kaiko extends our credit franchise into on-chain finance, building on more than two decades of liquidity, transparency, and tradability on iBoxx benchmarks while preserving trusted rigor and governance,” he said.
The iBoxx USD Liquid Investment Grade Index is an existing S&P DJI credit benchmark. The announcement describes the tokenized version as combining the index data with access permissions and usage rules. Those rules are intended to keep the distribution of the index values within the licensing terms S&P DJI has historically applied to its benchmarks. The companies said this approach gives benchmark providers a controlled and auditable way to distribute index intellectual property across new institutional markets and products.
Ambre Soubiran, CEO of Kaiko, said the transaction demonstrates how tokenized benchmark infrastructure can support new institutional markets and products while preserving the licensing, governance, and operational standards required by financial institutions. Kaiko’s role in the transaction was to tokenize the index on Canton and to distribute the signed official values used for valuation.
Nilesh Jethwa, CEO of Marex Solutions, said the transaction provides a practical example of how OTC derivatives can be represented and managed on distributed ledger infrastructure, in line with Marex’s focus on bridging traditional finance and digital assets. He said the trade shows how new technology can support more coordinated and transparent workflows while preserving the controls required by institutional market participants.
What the companies described as the broader workflow
The announcement said the transaction demonstrates how a derivatives workflow can connect benchmark distribution, licensing, trade representation, and valuation within shared infrastructure. The companies said this connection allows trading platforms and counterparties to consume benchmark data within their existing transaction and lifecycle workflows rather than through separate data feeds that are reconciled after the fact.
Future functionality is expected to connect Derivnex-managed positions with digital cash and collateral on Canton. The companies said this would enable margin, collateral, and contractual payments to move within the same infrastructure as the underlying transaction. The announcement does not give a timeline for that functionality or describe any cash or collateral movement that occurred with the 13 October swap.
The companies described the trade as the first OTC derivative to reference a fully tokenized index on distributed ledger infrastructure. They said the transaction shows that an existing credit benchmark can be distributed under controlled conditions and used to value an OTC position that is itself represented as a smart contract. The announcement does not state whether additional swaps referencing the same tokenized index have been executed or are planned.
DRW and Marex are the named counterparties. Derivnex is the platform on which the swap was executed. S&P Dow Jones Indices is the provider of the underlying iBoxx index. Kaiko is the firm that tokenized the index on Canton and distributed the signed values used for valuation. The announcement does not describe any regulatory filing or approval associated with the transaction.
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