US SEC weighs tokenised stock trading on crypto exchanges – Crypto News – Crypto News
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US SEC weighs tokenised stock trading on crypto exchanges US SEC weighs tokenised stock trading on crypto exchanges

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US SEC weighs tokenised stock trading on crypto exchanges – Crypto News

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8 months ago

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The US Securities and Exchange Commission (SEC) is working on a proposal that could allow blockchain-based versions of publicly traded stocks to be bought and sold on cryptocurrency exchanges. If approved, the move would bring traditional equities closer to the digital asset space, blending two financial systems that have long operated separately.

According to The Information, the SEC’s plan is still in its early stages. It would give investors the ability to trade stock tokens – digital versions of company shares – on approved cryptocurrency trading platforms. The tokens mirror the ownership rights of traditional shares but are recorded on a blockchain instead of through conventional clearing systems.

The push reflects a growing regulatory interest in tokenisation, which uses blockchain technology to represent ownership of real-world assets. SEC Chair Paul Atkins recently described tokenisation as an “innovation” that regulators should support rather than limit. He argued that these assets could lower costs and expand access to financial markets if developed responsibly.

Rising interest in stock tokenisation

Momentum around tokenised stocks has been building. Trading platforms like Robinhood and Kraken have started rolling out tokenised equity products to meet growing cryptocurrency market demand. Meanwhile, Nasdaq has asked the SEC to approve a rule change that would let it list tokenised securities, and Coinbase is seeking permission to offer similar services on its cryptocurrency exchange.

Tokenisation is already reshaping parts of the financial sector, from private credit to US Treasuries. Stocks are emerging as the next major category. Industry figures show that more than $31 billion worth of assets have been tokenised so far, though equities make up only around 2% of that. Even so, their value has nearly doubled over the past 100 days, a sign that adoption is picking up speed.

A recent Binance Research report compared this rise to the early stages of the DeFi boom in 2020 and 2021. Researchers suggested that tokenised equities could soon reach a turning point as traditional finance and blockchain technology continue to converge. If just 1% of global equities were tokenised, the market could exceed $1.3 trillion, according to Binance’s estimates.

Traditional finance voices concerns

Not everyone in the financial industry is fully on board. Some established firms have urged regulators to move carefully. In a letter to the SEC’s Cryptocurrency Task Force in July, Citadel Securities warned that tokenised stocks should succeed by offering real benefits, not by exploiting gaps in existing rules.

“Tokenised securities must achieve success by delivering real innovation and efficiency to market participants, rather than through self-serving regulatory arbitrage,” the company wrote.

The SEC has not set a timeline for its proposal, but if it moves forward, it could mark one of the agency’s most concrete steps toward merging blockchain technology with regulated financial markets.

See also: Study names the top cryptocurrency nations

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Tags: coinbase, finance, tokenisation, trading platforms

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