Digital Asset Secures $135 Million for Canton Network Expansion Amid Institutional RWA Tokenization Push

Executive Summary

Digital Asset, the company behind the Canton Network, has successfully completed a $135 million Series E funding round, bringing its total capital raised to nearly $400 million. This significant investment, backed by prominent financial institutions, is directed at accelerating the adoption of institutional decentralized finance (DeFi) on the Canton Network. The network, a public permissionless layer-1 blockchain, is designed to integrate traditional financial markets with digital asset ecosystems by offering customizable privacy, compliance, and scalability for real-world asset tokenization and other on-chain applications.

The Event in Detail

Digital Asset announced a strategic funding round of $135 million, with lead investors including DRW Venture Capital and Tradeweb Markets. Additional participants in the Series E round featured major financial entities such as Goldman Sachs, Citadel Securities, BNP Paribas, and the Depository Trust & Clearing Corporation (DTCC). Crypto-focused investors included Paxos, Polychain Capital, Circle Ventures, and YZi Labs. The capital infusion aims to enhance the Canton Network's infrastructure, streamline the onboarding of new institutions, and support the interoperability required for managing a higher volume of real-world assets (RWAs).

The Canton Network, launched by Digital Asset in 2024, operates as a "network of networks" with independent sub-ledgers for participants, ensuring data isolation and privacy through advanced cryptographic techniques like Zero-Knowledge Proofs (ZKP) and Multi-Party Computation (MPC). The Daml smart contract language integrates access control directly, and a Global Synchronizer layer facilitates atomic settlement across disparate ledgers. This architecture allows institutions to tailor privacy settings while maintaining compliance and interoperability.

Pilot programs on the Canton Network have demonstrated its capabilities. In September 2024, Digital Asset and the DTCC completed a US Treasury Collateral Network pilot project. A subsequent pilot in October 2024, involving Euroclear, the World Gold Council, and Clifford Chance, successfully tokenized gold and bonds, including Eurobonds and gilts. By mid-March 2024, institutional investors had executed over 350 simulated transactions on the network across various DLT applications, including tokenized assets, fund registry, digital cash, repo, securities lending, and margin management.

Market Implications

This funding round and the continued institutional adoption of the Canton Network signal an accelerating trend towards the integration of traditional financial assets onto blockchain infrastructure. The network's emphasis on configurable privacy and compliance addresses key barriers that have historically hindered institutional engagement with blockchain technology. This development is expected to foster increased liquidity and efficiency in financial markets, potentially leading to the creation of new financial products and market structures.

The Canton Network's native tokenomics, centered around Canton Coin, are designed to incentivize utility rather than speculative value. The model features no pre-mine or VC allocations, ensuring that every token is earned through network participation. A burn-and-mint equilibrium ensures the supply of Canton Coin remains responsive to demand, with usage fees burned and new coins minted based on active participation. Distribution is allocated to infrastructure providers (35%), application builders (50%), and users (15%). This framework supported a 40% month-on-month growth in validators and a 20x increase in Canton Coin transfers in 2025, averaging approximately 3 million ledger events daily.

Expert Commentary

Industry leaders have underscored the significance of the Canton Network's progress. Changpeng "CZ" Zhao, through YZi Labs, described his investment as "merging Wallet Street and blockchain," highlighting the potential for traditional finance to converge with decentralized technology. Polychain Capital noted that "Canton Network addresses critical barriers–privacy, compliance, and scale–that have long hindered institutional DeFi adoption," positioning it as a catalyst for innovation. The confidence of institutions like HSBC, Goldman Sachs, and regulators such as the Hong Kong Monetary Authority in Canton's capabilities further validates its approach to scalable, privacy-preserving, and compliant financial infrastructure.

Broader Context

The funding and institutional uptake of the Canton Network are indicative of a broader shift in corporate strategy towards embracing digital asset infrastructure. Unlike companies like MicroStrategy that primarily incorporate Bitcoin into treasury management, Digital Asset's approach focuses on building the foundational layers for tokenization and on-chain financial services for established institutions. This represents an evolution in how major corporations are integrating blockchain, moving from asset acquisition to infrastructure development that enables new business models and operational efficiencies.

Digital Asset is strategically expanding the Canton Network's global reach, with a particular focus on key growth markets in Asia, including Hong Kong, Japan, Singapore, and the Middle East. This regional emphasis aligns with increasing regulatory clarity and institutional interest in digital assets across these jurisdictions. The company anticipates additional live deployments from major financial institutions and continued expansion into new global markets over the next 12 to 18 months, solidifying Canton Network's role in the evolving global financial infrastructure. The successful pilot programs and robust growth metrics suggest Canton is entering a significant implementation phase, further bridging traditional finance and the Web3 ecosystem.