Regulators Signal Shift Towards Mass Tokenization

CFTC Chair Michael Selig is advocating for mass tokenization of real-world assets (RWAs), comparing it to the shift from manual signals to electronic trading. This move would enable faster settlement and real-time collateral movement, according to Selig.

The CFTC has submitted a regulatory action for White House review, but it remains in the 'prerule' stage. Meanwhile, the SEC is pushing forward with tokenized markets, including granting a temporary 'Innovation Exemption' for tokenized US stock trading.

Selig emphasized that regulators should adopt a 'principles-based' approach to tokenization and onchain finance, rather than waiting for broad, future rulemaking. This framework would allow different tokenization architectures while providing necessary interpretation and compliance guidance as new cases emerge.