CFTC Chief Warns Markets Must Prepare for Mass Tokenization

Commodity Futures Trading Commission (CFTC) Chairman Michael Selig has warned that markets need to prepare for 'mass tokenization', a trend he believes will bring significant changes over the next decade. Speaking at the US Treasury Market Conference, hosted by the Federal Reserve Bank of New York, Selig emphasized the importance of adapting existing rules to new technologies such as blockchain and artificial intelligence.

Selig credited the Trump administration's approach to digital assets for helping keep the United States ahead in these markets. He pointed out that the CFTC has already taken concrete steps toward wider tokenization, including expanding the list of assets that can be used as collateral to include stablecoins issued by national trust banks.

The agency will continue to support stablecoin use among regulated participants, including market participants, exchanges, and clearinghouses. This comes as the Securities and Exchange Commission (SEC) has released its long-awaited 'innovation exemption' rule change, aimed at making room for on-chain trading of tokenized stock.