- The SEC plans to allow trading of blockchain-based registered shares on approved crypto platforms.
- Nasdaq, Coinbase and others are pushing for tokenized stocks as adoption accelerates.
- A tokenized securities market could reach $1.3 trillion if 1% of global equities move onto blockchains.
The U.S. Securities and Exchange Commission (SEC) is developing a proposal to permit blockchain-registered versions of stocks to trade on regulated crypto exchanges, signaling a potential breakthrough in integrating digital asset technology with traditional capital markets.
If adopted, the measure would allow investors to buy and sell tokenized shares of publicly traded companies on regulated crypto platforms, according to The Information.
While the plan is still in its early stages, it underscores growing regulatory openness to tokenization — the process of creating blockchain-based tokens that represent ownership of conventional assets.
Regulators signal openness to innovation
SEC Chair Paul Atkins recently described tokenization as an “innovation” that the agency should promote rather than restrict.
“We should focus on how we promote market innovation,” Atkins said, suggesting that tokenized assets could broaden access to financial markets while lowering costs.
The initiative comes amid rising momentum across the industry.
Nasdaq has filed with the SEC to amend rules that would allow it to list tokenized securities, while Coinbase is seeking regulatory approval to offer tokenized stocks on its platform.
Retail platforms such as Robinhood and Kraken have already started launching tokenized stock products for users.
These developments reflect a broader shift among regulators and market operators toward adopting blockchain technology in securities markets.
However, significant questions remain about market structure, investor protection, and oversight as tokenization moves closer to the mainstream.
Pushback from the traditional establishment
The SEC’s apparent willingness to explore tokenized stocks has drawn criticism from established financial institutions.
In a July letter to the agency’s Crypto Task Force, Citadel Securities urged regulators to ensure tokenized securities deliver real value to markets rather than exploiting regulatory gaps.
“Tokenized securities must succeed by providing genuine innovation and efficiency to market participants, not by taking advantage of regulatory arbitrage,” the firm warned.
That skepticism reflects a wider tension between traditional finance and the emerging digital-asset sector.
While tokenization promises faster settlement, greater transparency, and lower costs, critics caution about potential risks if the technology expands without clear safeguards.
Tokenized stocks gain momentum
Despite concerns, tokenized stocks are gaining traction.
Industry data shows that more than $31 billion in assets have been tokenized, with equities accounting for roughly 2% of that total.
Yet the value of tokenized stocks nearly doubled in the past 100 days, indicating an acceleration in adoption.
A recent Binance Research report compared the growth of tokenized stocks to the early rise of decentralized finance (DeFi) in 2020 and 2021.
The report suggested that tokenized shares could soon reach an inflection point in a broader shift toward hybrid finance, where blockchain technology coexists with traditional markets.
Binance estimates the tokenized equity market could ultimately exceed $1.3 trillion if just 1% of global equities migrate to blockchain networks.
As regulators weigh next steps, the SEC’s forthcoming proposal will be closely watched by market participants.
Its outcome could determine whether tokenized shares remain a niche product or develop into a transformative force in global capital markets.