SEC eyes tokenised stock trading framework

The US Securities and Exchange Commission is reportedly preparing a new framework for tokenised securities trading platforms as Wall Street firms deepen efforts to move traditional assets onto blockchain infrastructure.

According to Bloomberg Law, the SEC could introduce an “innovation exemption” as early as this week that would allow platforms to offer blockchain-based versions of publicly traded securities under a lighter regulatory structure.

SEC Chair Paul Atkins said earlier this month the agency was considering formal rulemaking for onchain trading systems, blockchain settlement infrastructure and crypto custody models as financial markets become increasingly automated and AI-driven.

Tokenised stocks are digital blockchain-based versions of equities designed to enable faster settlement and round-the-clock trading, though critics have raised concerns around liquidity fragmentation and investor protections.

Depository Trust & Clearing Corporation said it plans to begin limited production trades of tokenised assets in July before a broader rollout in October using tokenised stocks and ETFs backed by assets already held within its infrastructure.

Nasdaq is also developing a blockchain-based share issuance framework after the SEC approved its tokenised securities proposal in March, while Intercontinental Exchange expanded plans for tokenised stocks and crypto-linked products through a partnership tied to crypto exchange OKX.

Atkins said existing securities rules were not designed for blockchain-based systems that combine trading, clearing and settlement into a single protocol, arguing the SEC should provide regulatory clarity through rulemaking rather than enforcement actions.