Introduction to Tokenized Stocks
The prospect of trading tokenized stocks in the U.S. is gaining traction, with the Securities and Exchange Commission (SEC) on the brink of introducing a new regulatory exemption. This development is anticipated to benefit various crypto companies, particularly Coinbase, which is gearing up for its own tokenized stock offerings.
Proposed Regulatory Changes
According to legal and market sources cited by Reuters, SEC Chair Paul Atkins is likely to present an innovation exemption that would permit companies to trial blockchain-based financial products under a relaxed regulatory regime.
This proposal comes at a time when a number of crypto firms are actively working on tokenized equity offerings that would enable users to trade shares continuously, featuring near-instant settlement times. Coinbase has indicated its intent to launch tokenized stocks that are directly backed by physical shares at a one-to-one ratio, while other platforms like Binance are expanding their tokenized stock services in markets outside of the U.S.
Rights and Regulatory Concerns
If approved, the new framework could grant tokenized shares the same rights as traditional assets, including dividends and voting rights. Previously, the SEC had postponed discussions on allowing tokenized equities, citing concerns related to investor protection and custody obligations. However, recent insights suggest the agency is preparing a revised strategy that would facilitate innovation while easing stringent compliance requirements.
Market Structure Proposal
In addition to the potential tokenized stock exemption, the SEC has progressed a market structure proposal that may affect the trading of these equities within the United States. Last week, the commission proposed eliminating Rules 611 and 610(e) of Regulation NMS, which have been foundational to U.S. stock trading since 2005. Rule 611 prevents venues from executing stock orders at worse prices when better options exist, while Rule 610(e) pertains to locked and crossed market quotations.
This proposal is set to initiate a 60-day public comment period following its release in the Federal Register. SEC Chair Atkins justifies the re-evaluation of Rule 611 based on two decades of market impact assessment, suggesting that it may have inadvertently hindered competition and complicated equity markets.
Growing Interest in Tokenized Stocks
Although the current proposal does not specifically endorse tokenized stock trading, it signifies the SEC’s ongoing efforts to adapt regulations to the emerging blockchain-based securities environment. Previous reports mentioned that SEC officials are contemplating an exemption tailored to accommodate tokenized public equities.
Interest in tokenized stocks has surged significantly over the last two years. Data from CoinGecko reveals that the number of tokenized stock assets has skyrocketed from just 14 in January 2024 to 478 by May 2026, resulting in an impressive growth rate of over 3,300%. The rapid increase in real-world asset projects is also noteworthy, climbing from 64 to 1,282—a rise of approximately 1,900%.
Major financial institutions, including Citigroup, are also entering this space by developing tokenized shares linked to private entities like OpenAI and Anthropic, initially aimed at overseas investors with the potential to extend access to the U.S. market later.
Future of Tokenized Trading
Additionally, the New York Stock Exchange is in the process of creating infrastructure to support round-the-clock trading using tokenized systems. The SEC’s ongoing examination of tokenized equity exemptions and market structure modifications has positioned blockchain-based stock trading at the brink of mainstream acceptance within U.S. regulatory frameworks, marking a significant evolution from its inception.
