US Regulators Told to Prepare for Mass Tokenization Amid Industry Shift

CFTC Chair Michael Selig has urged regulators to prepare for 'mass tokenization' in US markets, framing it as a defining change of the coming decade. Speaking at a US Treasury Market conference, he noted that the next decade will likely bring more change than the previous several decades combined.

Selig highlighted three concrete CFTC moves over the past year, including issuing guidance and seeking public comments on 24/7 trading for energy derivatives markets. He also mentioned expanding the list of eligible collateral to include stablecoins issued by national trust banks, which will allow banks to back derivatives margin with tokenized dollars.

The CFTC's moves are part of a broader effort to encourage innovation and competition in financial markets. However, the lack of a Senate framework for regulating the crypto industry has created an operational picture where issuers must navigate two separate tracks: SEC exemption for tokenized securities and CFTC guidance for derivatives and stablecoin collateral.