SEC prepares plan for trading tokenized stocks this week
Wall Streets biggest exchanges are gearing up to let investors trade tokenized versions of traditional stocks. The SEC is preparing to formalize a framework for how these digital securities will operate within existing market infrastructure. Whats actually happening The SEC has already laid significant groundwork here. Back on March 18, the agency approved a Nasdaq rule change that allows certain stocks and ETFs to be traded and settled in tokenized form alongside their traditional counterparts. The scope of that approval isnt small. It covers Russell 1000 stocks, which represent the thousand largest publicly traded US companies. It also extends to ETFs linked to major benchmarks like the S&P 500 and Nasdaq 100. The SEC also released a “Statement on Tokenized Securities” that draws a clear line in the sand. Existing federal securities laws apply fully to tokenized instruments. No special exemptions from registration. No workarounds on reporting obligations. A tokenized share of Microsoft is still a security, and it still has to play by the same rules as a regular share of Microsoft. The exchange arms race Nasdaq isnt the only one making moves. The NYSE is developing its own tokenized securities trading platform, with ambitions that go further than what Nasdaq has rolled out so