SEC prepares to unveil tokenized stock exemption as DTCC eyes July production trades
The SEC’s tokenized stock exemption could land as early as this week, opening a regulated path for digital versions of publicly listed securities to trade on decentralized crypto platforms. The exemption has been in development since SEC Chair Paul Atkins launched Project Crypto in July 2025 and told the Economic Club of Washington on April 21 that the agency was “on the verge” of releasing it.
Depository Trust & Clearing Corporation (DTCC), which clears and settles almost all the stock transactions in the US, will begin conducting trade of tokenized assets on its test environment in July with a further rollout scheduled for October.
In December 2025, the US SEC’s Division of Trading & Markets provided a no-action letter to the DTCC allowing for the pilot program. The pilot includes equity and ETF securities that have their underlying assets held in the DTCC custody system.
What the exemption actually allows
This exemption allows eligible companies up to three years during which to operate within reduced regulatory requirements. In those three years, they will be able to issue and deal in tokenized security offerings while being exempted from full registration with the SEC, provided certain volume and participant limitations are followed.
At the end of that period, the project either proves it has decentralized enough to fall under CFTC oversight or files for full SEC registration.
“A stock remains a stock, whether represented on paper, through a DTCC entry, or as a blockchain token,” Atkins said at an earlier briefing. He also signaled support for letting automated market makers and decentralized protocols participate.
“In my view, market participants should be able to engage with decentralized applications on public, permissionless blockchains if they desire,” he told the ETHDenver audience in February.
The SEC’s January 28, 2026 joint staff statement separated issuer-sponsored tokenized securities, which carry real equity, from third-party synthetic products that give holders price exposure to a stock without granting any equity or voting power.
Nasdaq, NYSE, others are building the rails before the rule drops
Nasdaq is working on a share issuance platform based on blockchain that does not remove ownership benefits associated with traditional shares. In turn, NYSE plans to introduce a new rule that will allow tokenized equities and ETFs to be traded and settled on the blockchain 24 hours a day via its platform.
As reported by Cryptopolitan two weeks ago, the NYSE initiative entails the introduction of a new Rule 7.50 and an amendment to certain rules relating to order display, ranking, execution, routing, and settlement.
Crypto-native platforms aren’t sitting around idly either. According to The Block, Kraken’s xStock offering has generated over $25 billion in trading volume to date. Robinhood’s real-world asset blockchain recorded over 4 million trades in its first week alone.
Securitize brought regulated stock trading on the blockchain in late 2025 with genuine equity ownership on the ledger of the issuing company. Kraken started trading tokenized stocks. tZERO with backing from Intercontinental Exchange is getting ready for its IPO.
Not everyone wants this to happen fast
Commissioner Hester Peirce, who leads the SEC’s Crypto Task Force, tempered expectations at ETHDenver in February.
Both groups are likely to realize that the innovation exemption is not as monumental as either faction anticipated. It would be an important step toward facilitating the integration of tokenized securities into our existing financial system, but it would not change the entire financial system overnight.
– Hester Peirce
She was referring to crypto advocates who expect the rule to bypass SEC oversight entirely and traditional finance players who fear it will gut investor protections
Last July, Citadel Securities wrote a letter to the SEC, calling for structured rulemaking before launching tokenized securities, as shortcuts can lead to potential regulatory loopholes and hurt the IPO market
According to the World Federation of Exchanges, which consists of Nasdaq and CME Group, such extensive exceptions would compromise the principle of protecting investors and offer an advantage over regulated exchanges.
It is still an open issue whether atomic settlement on blockchain would go against SEC’s existing rules regarding T+1 settlement for standard transactions.
Tokenized versions of real assets amounted to $27 billion by April 2026, up by 85 percent compared to the year before, with institutional investors making up most of the gains. What is missing now is regulatory clarity in the US. With this new exemption, it will all fall into place.
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