SEC Temporarily Waives Registration Requirements for Tokenized Equity Trading
The Securities and Exchange Commission (SEC) has announced a temporary framework to enable digital asset brokerages and trading platforms to support tokenized equity trading without full exchange registration. This decision was made in response to a request from eligible platforms, including Coinbase and Robinhood.
The SEC's Innovation Exemption will allow these platforms to trade tokenized U.S. equities for five years, pending further public comment on permanent regulatory policies for on-chain securities. Tokenized equities represent traditional corporate shares as digital tokens on a blockchain, enabling 24/7 trading, fractional ownership, and more efficient settlement.
The move has given a boost to the broader cryptocurrency market, with Bitcoin trading up around 2% at $78,000. This added momentum to crypto-linked equities, causing Coinbase's shares to jump 10.5%, while Robinhood's shares rose 7.6%. However, investors should be cautious as these stocks are known for their volatility.
Coinbase, in particular, has experienced significant price swings over the past year, with 61 moves greater than 5%. The company's shares have also dropped significantly since the beginning of the year, down 17.7%, and are currently trading at $194.63 per share, or 49.7% below their 52-week high.