SEC Proposes Rule Changes to Accommodate Blockchain-Enabled Transfer Agents

The U.S. Securities and Exchange Commission (SEC) has proposed updating the rules for registered transfer agents to reflect their current mode of operations, including the use of blockchain technology.

According to a press release, the Commission's rules have not been substantively updated since the late 1970s and early 1980s, which is why the SEC is seeking to modernize them.

SEC Chair Paul Atkins noted that the proposal would 'streamline and modernize' the Commission's rules to reflect transfer agents' current processes and operations. This includes using blockchain technology in connection with securities offerings and share transfers.

The proposed rule change comes as tokenized securities gain prominence, with traditional finance stakeholders moving assets onchain. The Commission is also seeking to introduce an innovation exemption rule for these tokenized securities.