SEC Opens Door to Tokenized US Stocks With 5-Year Exemption — SkimNews
Get the Finance newsletter
Daily finance — markets, central banks, M&A, the prints that move money. Free.
- SEC issued an order creating a regulatory pathway for tokenized representations of publicly traded US stocks, effective immediately, via a five-year Innovation Exemption under the agency's Project Crypto initiative
- The exemption requires stock tokens to grant holders the same rights as traditional equity — including dividends and voting — and gives companies a 30-day window to object before a tokenized version of their shares can trade
- The move comes two days after the Clarity Act, crypto's major market-structure bill, failed to advance in the Senate, with the SEC acting under its existing authority to define regulatory boundaries instead
- Coinbase, Robinhood, Gemini, and Kraken have already launched tokenized equity offerings offshore but have not yet offered them to US customers, a gap the exemption could now open
- The SEC included volume limits to mitigate risks from 24/7 trading and thinner liquidity, with Chair Paul Atkins framing the order as interim guidance meant to inform durable rulemaking
- AMC CEO Adam Aron's public fight with Robinhood over stock-token exposure without issuer consent helped catalyze the rights-preservation and opt-out conditions in the new framework
- Robinhood said this week it plans to let token holders redeem on a 1:1 basis for underlying shares and add voting rights, addressing the corporate-consent concerns baked into the exemption
Why it matters: With the Clarity Act stalled in Congress, the SEC used its exemption authority to hand crypto-friendly exchanges — Coinbase, Robinhood, Gemini, Kraken — a potential on-ramp to bring their offshore tokenized stock products to US customers, but the 30-day issuer veto means companies can block tokenization of their own shares, effectively giving corporate America a kill switch over which stocks become tradable 24/7 on blockchain rails.
Ask SkimNews
