SEC Unveils Five-Year Pathway for Regulated Stocks on Blockchain
The US Securities and Exchange Commission (SEC) has announced a five-year pathway for regulated US stocks to trade on blockchain-native venues. This move, known as the Innovation Exemption, was made just two days after Congress failed to advance the CLARITY Act, a comprehensive crypto market-structure bill.
SEC Chair Paul Atkins explicitly tied the Sept. 17 action to the stalled legislation, stating that the agency was acting 'within its statutory authority' to facilitate on-chain trading of certain tokenized stocks. This decision opens the $77 trillion US stock market to crypto-style trading.
The exemption creates a framework for Tokenized Securities Venues (TSVs) that bring buyers and sellers together through permissioned automated market makers and liquidity pools. Qualifying venues receive temporary relief from being treated as exchanges under the Securities Exchange Act, while certain liquidity providers using their own capital can receive related relief from dealer-registration requirements.
The move coincided with an SEC roundtable on preparations for 24-hour US equity trading, reflecting a broader shift toward markets that operate beyond traditional session hours. Atkins said economic and corporate events no longer occur neatly within market hours, and investors increasingly want the ability to adjust positions when news breaks.