SEC Plans Innovation Exemption for Tokenized Stock Trading in US Markets

The US Securities and Exchange Commission (SEC) is reportedly preparing an “innovation exemption” that could allow blockchain-based platforms to offer tokenized trading of publicly listed companies. The move may open the door for stocks to trade outside traditional exchanges using decentralized crypto infrastructure.

According to reports, the exemption could be introduced as early as this week. It may allow third-party firms to issue blockchain-based versions of company shares, even without direct approval from the businesses involved. However, regulators are reportedly considering rules requiring tokenized stocks to provide the same benefits as regular shares, including voting rights and dividends, or face removal from trading.

Tokenized Stocks Gain Attention From Financial Firms

Interest in tokenized securities has grown as financial firms explore faster settlement systems and around-the-clock trading. Supporters argue the technology could improve market access, especially for investors outside the United States who face barriers to traditional brokerage services.

Companies connected to stock market infrastructure and crypto trading have already expanded their tokenization efforts, seeing blockchain as a way to modernize financial markets.

Concerns Over Investor Protection and Ownership

Not everyone supports the proposal. Some SEC officials reportedly questioned the decision, while tokenization platform Securitize warned that third-party tokenized shares without company involvement could create confusion around ownership, valuation and shareholder rights.

The development also comes as lawmakers continue debating crypto market rules, with many industry figures arguing that legal clarity remains essential before tokenized assets become mainstream.