The US Securities and Exchange Commission is seeking public Feedback to decide whether Nasdaq can list and trade tokenized stocks. The move comes as regulators closely examine how blockchain-based assets could fit into existing market rules.
If approved, blockchain-based shares could trade like regular stocks, offering faster and cheaper settlements.
According to the SEC filing on Nasdaq’s rule change, the SEC has asked for public Feedback to decide whether Nasdaq should be allowed to list and trade securities in tokenized form.
This marks the start of a deeper review process covering legal, technical, and policy issues.
Under Nasdaq’s plan, tokenized stocks and exchange-traded products would trade alongside traditional shares. Both would use the same order book, offer the same investor rights, and settle through the DTCC, while blockchain technology improves efficiency.
A key example of this shift is Galaxy Digital, which recently became the first Nasdaq-listed company to tokenize its stock on Solana, showing how traditional finance and blockchain are merging.
Market participants have shown mixed responses to the proposal. Groups like the Securities Industry and Financial Markets Association support the plan, saying tokenization can improve how markets work.
At the same time, the US Commodity Futures Trading Commission has approved a test program that allows tokenized assets to be used as collateral, showing growing acceptance.
However, firms like Ondo Finance and Cboe Global Markets have opposed the idea. They want the SEC to wait until DTCC clearly explains how tokenized trades will be settled, since all such trades would still depend on DTCC systems.
In a related development, the SEC recently issued a no-action letter to the Depository Trust Company, part of DTCC, allowing it to tokenize certain custody assets. This decision is seen as a critical building block, as any tokenized trades on Nasdaq would still need to clear and settle through DTCC systems.
Meanwhile, the CFTC now allows tokenized bitcoin, ether, and USDC as derivatives collateral.
Banks like JPMorgan and BMW are testing on-chain transactions, showing tokenization can make trading faster, cheaper, and available 24/7 despite some challenges.
Tokenized stocks are blockchain versions of traditional shares, offering faster settlement and lower costs while maintaining the same rights and regulations as regular stocks.
Not exactly. Nasdaq seeks SEC approval to list tokenized stocks—traditional securities on a blockchain—which would trade alongside regular stocks using the same systems and rules.
Under Nasdaq’s plan, tokenized stocks would still settle through the DTCC, using blockchain to streamline the process while relying on established, regulated financial infrastructure.
If approved, they’d operate under the same investor protections, regulations, and clearing systems as traditional stocks, with added blockchain efficiency. Regulatory scrutiny aims to ensure safety.
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