U.S. SEC Could Open Door to Tokenized Stock Trading on DeFi Platforms

The U.S. Securities and Exchange Commission (SEC) is reportedly working on an “innovation exemption” framework that could be introduced as soon as this week, potentially enabling the trading of tokenized versions of publicly listed stocks on blockchain networks.

Under this proposed system, third-party entities would be allowed to issue digital tokens linked to shares of public companies without requiring direct approval from those companies, and trading is expected to extend to decentralized finance (DeFi) platforms.

However, the framework would also introduce requirements for platforms listing these assets, including the risk of losing eligibility if token holders are not provided standard shareholder rights such as voting privileges or dividend access.

Source: Bloomberg