Virtu Financial, M1X Global and Tradeweb Use USDM1 to Complete Landmark Institutional Collateral Transaction

Virtu Financial, M1X Global and Tradeweb today announced the completion of the first fully onchain repo transaction in which the securities leg was a sovereign digital bond. Executed on the Canton network, every element of the transaction - securities delivery, cash leg and return - settled atomically onchain. The transaction is the first known instance of a natively issued sovereign digital security functioning as collateral in a repo executed through a major institutional electronic trading venue without prime broker intermediation.

The Virtu repo was executed bilaterally on the Tradeweb platform between regulated institutional counterparties. It mapped structurally to a conventional sovereign-collateralized repo but utilized a digitally native issuance benefiting from ledger-based collateral mobility. The confirmation included a complete repo cycle - execution and repurchase - in under 10 minutes, a structure that is operationally impossible under T+1 settlement infrastructure. Where earlier onchain repo demonstrations relied on digital cash instruments in place of sovereign securities collateral, or on securities collateral held off-chain, this transaction was the first to combine natively issued sovereign collateral with fully onchain atomic settlement across both legs.

USDM1, the securities leg of the transaction, is a sovereign bond issued natively onchain by the Republic of the Marshall Islands, structured under New York law in the style of a fully collateralized Brady bond. It is backed 1:1 by short-dated US Treasuries held in bankruptcy-remote custody. Holders benefit from a first-priority perfected security interest in collateral under UCC Articles 8 and 9. The instrument is classified as a UCC Article 8 investment security, is eligible for inclusion in ISDA and GMRA close-out netting sets, and supports sovereign look-through to Level 1 HQLA. Under Basel 3.1's standardized approach, it delivers materially lower risk-weighted asset consumption than corporate payment stablecoins, tokenized money market fund shares or unrated digital asset exposures. Unlike digital cash instruments, USDM1 pays a coupon when used as margin or collateral. The instrument is available through Tradeweb with institutional custody through Anchorage, BitGo and tZERO. It is also supported by FDIC-insured Bank of Guam.

Atomic settlement on the Canton Network eliminates the intraday balance sheet inflation and settlement exposure that arises under T+1 infrastructure and increases effective collateral velocity, enabling same-day reuse that is not possible in traditional repo markets.

USDM1 was structured under advice of Cleary Gottlieb as issuer's counsel, with a New York law indenture, an explicit customary waiver of sovereign immunity, and documentation designed to support title-transfer repo, collateral substitution, and reuse within institutional frameworks under standard ISDA and GMRA documentation.

Participant Commentary

Jordan Goldman, President and COO, M1X Global: "Derivatives and secured financing markets have been waiting for collateral that works across institutional and digital rails simultaneously. USDM1 is a secured sovereign digital bond - not a stablecoin, not a tokenized fund, not a CBDC. It combines the legal framework and capital treatment institutional counterparties require with 24/7 settlement. This transaction demonstrates for the first time what onchain sovereign collateral looks like in production."

Dan Eckstein, Head of Rates Sales, Virtu Financial: "Virtu's business is built on providing liquidity efficiently across every market we operate in. Capital efficiency is not an abstract concept for us - it shows up directly in our ability to deploy working capital and serve clients. USDM1 addresses collateral constraints that have limited onchain capital markets and prevented them from reaching institutional scale. We are committed to helping build the foundational infrastructure this market requires."

Liz Kirby, Head of Market Structure, Tradeweb: "We see tokenization as an important next step in the evolution of electronic trading and market infrastructure. The completion of this transaction demonstrates how digitally native sovereign collateral and atomic settlement can enhance collateral capital efficiency and modernize repo workflows, all while maintaining the institutional standards market participants have come to expect. We are pleased to collaborate with other industry leaders on developing and advancing practical solutions that support the continued evolution of institutional markets."

About USDM1

USDM1 is a fully collateralized, USD-denominated sovereign bond natively issued onchain by the Republic of the Marshall Islands. It is structured in the style of a Brady bond under New York law, with an explicit customary waiver of sovereign immunity, and secured on a 1:1 basis by short-duration US Treasury instruments pledged by a US trust company in a bankruptcy-remote structure.

The Republic of the Marshall Islands operates exclusively on the US dollar standard under its Compact of Free Association with the United States. As a dollar-denominated sovereign obligation, USDM1 does not carry foreign-exchange or convertibility risk. Holders maintain enforceable rights to par redemption against a sovereign issuer and a perfected, first-priority security interest in Treasury collateral under UCC 8/9. For more on USDM1, see https://mof.gov.mh/usdm1-whitepaper/.

USDM1 is compatible with ISDA, GMRA and GMSLA agreements for derivatives, repo and secured lending, and is eligible for robust US close-out netting protections. Cleary Gottlieb Steen & Hamilton LLP serves as issuer's counsel and advised with respect to the structuring of the instrument under New York law, with the participation of partners specializing in sovereign debt, UCC and secured transactions, creditors' rights, netting and digital asset markets.

About Virtu Financial, Inc

Virtu is a leading provider of financial services and products that leverages cutting-edge technology to deliver liquidity to the global markets and innovative, transparent trading solutions to its clients. Leveraging its global market making expertise and infrastructure, Virtu provides a robust product suite including offerings in execution, liquidity sourcing, analytics and broker-neutral, multi-dealer platforms in workflow technology. Virtu’s product offerings allow clients to trade on hundreds of venues across 50+ countries and in multiple asset classes, including global equities, ETFs, foreign exchange, futures, fixed income, cryptocurrency and myriad other commodities. In addition, Virtu’s integrated, multi-asset analytics platform provides a range of pre-, intra-, and post-trade services, data products and compliance tools that clients rely upon to invest, trade and manage risk across global markets.

About Tradeweb Markets

Tradeweb Markets Inc. (NASDAQ:TW) is a leading, global operator of electronic marketplaces for rates, credit, equities, and money markets. Founded in 1996, Tradeweb provides access to markets, data and analytics, electronic trading, straight-through-processing, and reporting for more than 50 products to clients in the institutional, wholesale, retail, and corporates markets. Advanced technologies developed by Tradeweb enhance price discovery, order execution and trade workflows while allowing for greater scale and helping to reduce risks in client trading operations. Tradeweb serves more than 3,000 clients in more than 85 countries. On average, Tradeweb facilitated more than $2.6 trillion in notional value traded per day over the past four fiscal quarters. For more information, please go to www.tradeweb.com.

About M1X Global

M1X Global is a sovereign financial infrastructure and technology company bridging public finance and onchain capital markets. Operating in public-private partnership with the Republic of the Marshall Islands, M1X coordinates the legal, compliance, technology, custody and institutional infrastructure behind sovereign digital instruments.

Disclaimer

The content of this communication is for informational purposes only and is not intended to market, offer, or solicit you to buy or sell USDM1 or any financial product directly from Virtu Financial, M1X Global, Tradeweb, the Republic of the Marshall Islands or otherwise. USDM1 is being offered and sold solely outside the United States in reliance on Regulation S under the United States Securities Act of 1933, as amended (the "Securities Act"). The Republic of the Marshall Islands has not registered any offering of USDM1 under the US Securities Act, or any other US federal and state securities laws. Accordingly, USDM1 may not be offered, sold, pledged or otherwise transferred in the United States or to, or for the account or benefit of, US Persons (as defined in Regulation S), unless they are registered, or exempt from, or not subject to, registration under the Securities Act.

Nothing in this communication constitutes, or should be construed as, a recommendation by Virtu Financial, M1X Global, Tradeweb, the Republic of the Marshall Islands or any third party to acquire or dispose of USDM1 or any other security, or to engage in any investment strategy or transaction.

Prospective investors are urged to carefully read the offering memorandum prepared in connection with the offering of USDM1 in its entirety, including all annexes, appendices, and supplements thereto, before making any investment decision. The offering memorandum contains important information regarding, among other things, the terms of the securities, the risks associated with an investment therein, and the financial condition and business of the issuer. Prospective investors are solely responsible for determining whether any investment, security or strategy, or any other product or service, is appropriate or suitable for them based on their investment objectives and personal and financial situation. Prospective investors should consult an attorney or tax professional regarding their specific legal or tax situation.

Forward-Looking Statements

This release contains forward-looking statements. Forward-looking statements are not historical facts. Words such as anticipates, believes, estimates, expects, intends, plans, will and similar expressions are intended to identify them. Such statements reflect current views and are subject to risks and uncertainties, and rest on assumptions including general economic and market conditions, industry conditions and operating factors. There is no guarantee that the expected events or results will occur, and any change in those assumptions could cause actual results to differ materially from current expectations.

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Media Contacts

Kishan Naran, Wachsman: kishan.naran@wachsman.com

Matthew Sandberg, Virtu: investor_relations@virtu.com

Savannah Steele, Tradeweb: savannah.steele@tradeweb.com