SEC Set to Unveil Tokenized Stock Rules This Week
The U.S. Securities and Exchange Commission (SEC) is preparing a new framework for tokenized stocks that could change the way traditional shares are traded in crypto environments.
Summary:
- SEC is preparing rules for tokenized stocks.
- Platforms may be allowed to trade synthetic tokens.
- The new model creates a serious legal issue.
- Major financial companies are already building infrastructure.
- There is still no clear solution regarding investor rights.
The proposal, known as the Innovation Exemption, would allow tokenized versions of public companies such as Nvidia, Google, and Tesla to be traded directly on crypto platforms.
The Innovation Exemption is being considered as an official regulatory framework that, for the first time, would permit stock trading on blockchain infrastructure under clear legal rules.
Until now, the SEC had never created specific regulations for tokenized stocks. As a result, many platforms either avoided such products entirely or operated in a legal gray area without clear regulatory coverage.
The new framework creates two methods for issuing digital tokens that track the price of real stocks. The first option involves the company itself participating in the process. The second would allow an external company to create such tokens even without the consent of the actual issuer.
Under the external-company model, the SEC makes another important distinction. The first type is so-called custodial tokens. In this case, the issuer actually holds the real shares in a custodial account, while the token represents rights to those assets.
The second type is synthetic tokens. In this model, nobody holds the real shares. Instead, the price is replicated through a derivative contract that simply follows the stock’s movement.
Put simply, a synthetic token may move like the stock, but there may be no actual ownership of the company behind it at all.
To facilitate the transition to the new system, the SEC is also proposing a transition period of between 12 and 36 months, during which platforms would gradually meet the full regulatory requirements.
The framework also includes coordination with the U.S. Commodity Futures Trading Commission (CFTC) in order to avoid conflicts between regulators.
In addition, the SEC appears willing to allow tokenized stocks to trade on decentralized platforms operating 24/7 rather than only during standard stock market hours.
What tokenized stocks are
Tokenized stocks are digital versions of real shares recorded on a blockchain. The idea is for stocks to be traded as easily and quickly as cryptocurrencies are today.
Supporters of the model believe this could make financial markets faster, cheaper, and more accessible to investors around the world.
It appears that the SEC also sees potential in this direction. According to Bloomberg, the new framework could be published as early as this week. The project is supported by Chairman Paul Atkins and Commissioner Hester Peirce, who has long advocated for more flexible rules for the crypto sector.
Where the major problem appears
The main conflict comes from two rules the SEC is trying to combine at the same time.
On one hand, the framework would allow external companies to create tokens that track the price of stocks such as Nvidia or Tesla even without permission from the companies themselves. On the other hand, those same tokens are expected to provide rights similar to real shares – including voting rights and dividends.
This is where the main problems begin.
Voting rights in a public company are tied to actual ownership of shares that pass through an official system of custodians, brokers, and registries. If a crypto platform simply creates a token that copies Nvidia’s price, this does not mean the platform actually owns Nvidia shares.
READ MORE: SEC Scraps Settlement Silence Rule Under Paul Atkins
This is why critics argue that the two requirements cannot coexist simultaneously. If there are no real shares behind the token, the platform cannot genuinely transfer voting rights or dividends to investors.
In practice, the SEC is attempting to build a system in which synthetic tokens appear like real shares without having a mechanism that truly guarantees the same rights.
The market is moving faster than regulators
Interestingly, the tokenized stock market already exists even before the arrival of the new rules.
According to a Binance Research report, the sector has already reached around $1.4 billion. This is a tiny fraction of the global stock market, which was estimated at $151 trillion by the end of 2025, but the more important point is something else – major financial institutions are already actively building the infrastructure behind this model.
DTCC, Nasdaq, and ICE are already working on their own blockchain systems for tokenized assets. DTCC plans a limited launch of trading in July 2026 after receiving regulatory approval from the SEC back in 2025.
Nasdaq has also received approval and is working with Kraken on a global platform for tokenized stocks featuring near-instant settlement and round-the-clock trading. ICE, the company behind the New York Stock Exchange, is building blockchain infrastructure for stocks and ETFs.
This shows that a large part of the financial sector already views tokenization as the next major step for markets.
All criticism leads to the same issue
Brett Redfearn of Securitize warned that this could split liquidity across different platforms and confuse investors regarding the true value of their assets. SEC representatives are also concerned about market manipulation, weaker transparency, and insufficient anti-money-laundering controls.
OpenAI and Anthropic have already opposed the idea of their private shares being tokenized without permission.
According to critics, all of these problems originate from the same assumption – that tokenization can occur without the consent of the company behind the stock.
What decision the SEC must make
The SEC appears convinced that tokenization will become part of the future of financial markets. Paul Atkins himself has already stated that old rules were not designed for blockchain systems where trading, clearing, and settlement can happen almost simultaneously.
But before the new framework can function, the SEC must answer the most important question – whether the consent of the company itself will be a mandatory requirement for the creation of tokenized stocks.
If the new rules are published without a clear solution to this issue, many companies may begin filing lawsuits against platforms that tokenize their shares without permission. On the other hand, if the SEC delays the framework, institutional infrastructure will continue developing without clear regulation.
The information presented in this article is intended for informational purposes only and should not be interpreted as financial, investment, or trading advice. Coinspress.com does not promote or advocate for any particular investment strategy, asset, or cryptocurrency project. Cryptocurrency markets are highly volatile and unpredictable – always perform your own research and seek guidance from a qualified financial professional before making any investment decisions.
Kosta Gushterov
Reporter at CoinsPress
Kosta has reported on cryptocurrency markets and blockchain infrastructure since 2020, bringing over six years of hands-on experience in the crypto industry built through daily tracking of markets, trends, and emerging blockchain developments. Specializing in Bitcoin on-chain analysis, institutional ETF flows, and digital asset price action, his work has been cited by other news agencies and consistently covers market developments with a focus on data-driven reporting across Bitcoin, Ethereum, Solana, and XRP. Over the years, Kosta has contributed to multiple crypto media outlets in different regions, authoring over 6,000 articles across the sector. His reporting spans cryptocurrency markets and the broader fintech industry, tracking not only price action but also the technological and regulatory forces shaping the ecosystem. To support his analysis, Kosta actively leverages on-chain data and metrics from leading platforms such as Santiment, Glassnode, and CryptoQuant, enabling deeper, evidence-based market insights. He believes in the power of transparency and the data that underpins the blockchain ecosystem. His academic background in Marketing Management from Denmark further complements his analytical approach, adding a strong understanding of communication strategy and content positioning to his work.
