The U.S. Securities and Exchange Commission is preparing a possible regulatory path for platforms that want to offer tokenized versions of U.S. stocks with trading available around the clock. The agency is developing what it has described as an “innovation exemption” that could give selected firms temporary relief while broader rules are drafted.

The proposal remains preliminary. SEC Chair Paul Atkins has backed using exemptive authority to move more financial activity onto blockchain networks, and Commissioner Hester Peirce said in March that staff was working on a measure for limited trading in certain tokenized securities. But the commission has not released final terms, named who could qualify, or set a launch date.

A narrow test, not a broad approval

The exemption under discussion would be narrower than a blanket approval for tokenized securities trading. If adopted, it could allow approved venues to offer blockchain-based representations of U.S.-listed shares and process trades overnight, on weekends, and during market holidays, outside the normal hours of traditional stock exchanges.

For now, investors and firms cannot assume that every U.S. stock will soon be available in tokenized form for continuous trading. The SEC has not finalized the framework, and current federal securities rules still apply because the exemption has not taken effect.

The agency also recently canceled an open meeting that had been scheduled to consider a tailored offering regime for certain crypto-related investment contracts. According to the SEC’s public notice, that meeting concerned registration and offering rules for some crypto investment contracts and was separate from the tokenized-securities exemption project.

Tokenized shares would still be securities

The SEC’s developing approach does not change the legal status of the underlying assets. A token that represents a share in a public company would still be treated as a U.S. security, even if it is issued or traded on a blockchain.

That means firms involved in issuance, trading, custody, or settlement could still face requirements tied to broker-dealer registration, exchange or alternative trading system rules, transfer-agent records, and clearing obligations. Moving a stock onto a blockchain does not by itself remove it from the existing securities framework.

Custody is one of the central unresolved issues. Regulators need to determine how a blockchain token remains reliably linked to the underlying share, how buyers verify that backing, and what recourse exists if the issuer or custodian fails.

Surveillance and market plumbing remain open questions

The SEC is also weighing how market oversight would work if tokenized stocks trade when the main U.S. exchanges are closed. Participating venues would need controls to detect manipulation, share trading information, and supervise transactions taking place outside conventional market hours.

Another practical issue is settlement. Regulators may need to decide how blockchain-based settlement can operate alongside the Depository Trust Company’s custody and post-trade systems, which are central to today’s market infrastructure.

These questions help explain why the commission appears to be considering a limited exemption first, rather than a full market-wide rule change.

Existing pilots offer a model for the SEC

Some parts of the U.S. market have already received narrowly tailored permission to test tokenized securities in regulated settings. In December 2025, SEC staff issued a no-action letter allowing the Depository Trust Company to run a defined tokenization service for three years under specified conditions. That service covers Russell 1000 stocks, major index exchange-traded funds, and U.S. Treasury securities.

Nasdaq also entered the field after the SEC approved its pilot in March 2026. Under that structure, selected participants can trade certain tokenized equities alongside conventional shares, with tokenized and traditional versions carrying the same rights and pricing. The pilot is limited to eligible Russell 1000 securities and major index-linked ETFs.

NYSE has filed rule changes as well. SEC records show the exchange submitted amendments in April to enable securities to trade in tokenized form, giving the commission another regulated-market approach to evaluate.

Broader market-rule changes may shape the next step

At the same time, the SEC is considering amendments to Regulation NMS, the rule set that governs how U.S. equity orders move between venues. Among the proposals are rescinding Rule 611 and Rule 610(e), which address order protection and access fees in the national market system.

Ondo Finance has supported that proposed rescission, arguing that the existing framework favors continuous order books and can limit alternative execution systems built on different models. The company also asked the SEC to revise parts of the economic analysis before any amendments are adopted.

For now, the next confirmed step is limited: the SEC continues to develop the tokenized-securities exemption, but no final framework or implementation timetable has been announced. Until that changes, tokenized stock trading in the U.S. remains confined to regulated pilots and existing securities law requirements.

Source: crypto.news