SEC Grants Five-Year Exemption for Tokenized Stock Trading Platforms

The U.S. Securities and Exchange Commission (SEC) has granted a five-year exemption to platforms that handle tokenized stocks, allowing them to operate without some of the requirements that apply to traditional stock exchanges.

Tokenized stocks are digital tokens that represent an ownership stake in a company and can be traded via blockchain.

The new rules exempt platforms that facilitate such trading from complying with some of the requirements that apply to stock exchanges, including Nasdaq and the New York Stock Exchange.

The exemption will also apply to liquidity providers for tokenized stocks, who will temporarily not be required to undergo the standard registration process for dealers.

Before listing a tokenized version of a stock, platforms must notify the relevant company. If the issuer objects to the listing, the platform will be prohibited from offering the product.