The U.S. Securities and Exchange Commission is preparing a new exemption that would permit tokenized stock trading, according to reports citing legal experts and market analysts. SEC Chair Paul Atkins is expected to unveil an innovation exemption allowing companies to test blockchain-based financial products under adjusted regulations. This move comes as Coinbase and other crypto firms develop tokenized equity offerings for round-the-clock trading with near-instant settlement.
Coinbase has announced plans to issue tokenized shares backed one-for-one by underlying stocks, while Binance and other exchanges have already expanded similar services outside the U.S. The proposed framework would grant tokenized shares the same economic rights as traditional equities, including dividends and voting privileges. The SEC had previously delayed such exemptions due to concerns about investor protection and custody, but now appears to be crafting a revised approach that allows experimentation without requiring full compliance with existing rules.
Separately, the SEC advanced a proposal last week to modify market structure rules that could impact tokenized equities. The agency suggested rescinding Rules 611 and 610(e) of Regulation NMS, which have governed stock trading since 2005. Rule 611 prevents trading venues from executing orders at inferior prices when better quotes exist, while Rule 610(e) addresses locked and crossed quotations. Atkins argued that two decades of Rule 611 may have produced unintended consequences by limiting competition and increasing complexity.
Interest in tokenized stocks has surged dramatically, with CoinGecko reporting growth from 14 assets in January 2024 to 478 assets by May 2026—an increase of over 3,300%. Real-world assets also grew from 64 projects to 1,282, a nearly 1,900% rise. Major financial institutions are entering the space; Citigroup is preparing tokenized shares for private companies like OpenAI and Anthropic, initially targeting international investors. The New York Stock Exchange is also developing infrastructure for 24-hour trading through tokenized systems. Together, these developments suggest blockchain-based stock trading is moving closer to mainstream U.S. regulatory acceptance.