WASHINGTON — The U.S. Securities and Exchange Commission is preparing rules and guidelines that would facilitate trading of tokenized versions of stocks on blockchain platforms through an anticipated “innovation exemption.”
SEC Chair Paul Atkins is expected to issue the exemption framework in the coming weeks, according to people familiar with the matter. The move would allow crypto companies to offer blockchain-based representations of existing U.S. stocks under modified regulatory conditions.
The proposed exemption aims to enable experimentation with tokenized securities while maintaining certain investor protections. Tokenized stocks would represent digital versions of traditional equities, potentially enabling features such as near-instant settlement and 24/7 trading on decentralized or crypto-native platforms.
SEC staff issued a statement in January clarifying that tokenized securities remain subject to federal securities laws regardless of format. The new exemption would provide targeted relief for trading in such assets.
Commissioner Hester Peirce indicated expectations that any tokenized stocks under the exemption would confer rights and protections similar to traditional equities.
The market for tokenized stocks has grown significantly, with on-chain versions exceeding billions of dollars in capitalization, according to industry data. Companies such as Coinbase have signaled plans to launch tokenized stock offerings once rules permit.
Traditional exchanges including Nasdaq and NYSE have already taken steps to accommodate tokenized securities through approved rule changes. Some Wall Street firms have expressed concerns about potential market structure impacts and risks.
Atkins has described the initiative as part of broader efforts to support innovation in digital finance. The exemption is expected to be temporary and limited in scope.
As of Thursday, the SEC had not released the final text of the guidelines or a precise implementation timeline. Details on specific conditions, eligible blockchains, custody requirements and the scope of shareholder rights under tokenized versions remained subject to the forthcoming framework. Public comment and further agency action are anticipated following any announcement.
