SEC Greenlights Tokenized Trading for US Stocks

The U.S. Securities and Exchange Commission (SEC) has opened the door for blockchain-based trading platforms to offer tokenized versions of U.S. stocks, a move seen as a major step forward in the development of crypto-style trading.

Under a pair of five-year exemptions from current securities laws, these platforms will be allowed to trade tokenized shares that are linked to underlying physical stock. The exemption applies to tokenized NMS (National Market System) stocks and is conditional on meeting certain requirements, including giving issuers 30 days' notice before listing.

The move comes as the SEC continues to explore new rules for the crypto sector, which has been hampered by a lack of clear regulation. While some companies may opt out of participating in tokenized trading, the SEC believes that this exemption will allow innovation to flourish while maintaining investor protections and market integrity standards.