U.S. Regulators Lower Barriers for Tokenized Stocks and Prediction Markets

The U.S. Securities and Exchange Commission (SEC) will permit the on-chain trading (within blockchain networks) of tokenized stocks. The Commodity Futures Trading Commission (CFTC) has also eased registration requirements for online platforms that connect users to markets such as prediction markets. These changes are expected to significantly accelerate the activation of the digital financial market.

Reuters Yonhap News

According to the Wall Street Journal (WSJ) and Bloomberg News, on the 17th (local time), the SEC announced it would exempt certain regulatory requirements—normally applied to securities exchanges—for five years for tokenized stock trading platforms that meet specific conditions.

Not only stocks tokenized directly by companies, but also stocks tokenized by third parties can now be traded. However, tokenized stocks must provide shareholders with the same rights as conventional shares, such as dividends and voting rights—merely synthetic tokens tracking share price movements are not eligible. If a third party tokenizes a stock, the company must be notified and given the opportunity to object. For example, tokenizing Nvidia shares cannot simply track the share price; the tokens must also convey rights to dividends and voting, just as regular shareholders have.

The WSJ noted that the SEC's decision came just two days after the Clarity Act, a major virtual asset bill, failed to pass the congressional floor vote. It assesses the move as evidence of determination to establish an institutional pathway for some virtual assets and related products to enter the traditional financial markets. SEC Commissioner Paul Atkins stated, "Despite relentless effort by many, Congress has been unable to advance the Clarity Act. Today, within the authority granted by law, the SEC has facilitated on-chain trading of certain tokenized stocks. This marks a significant step toward transitioning the U.S. capital market into the digital era."

Additionally, the CFTC has lowered the barrier for trading through online platforms. Software firms that connect users to regulated trading entities, but do not directly hold customer assets, will no longer be penalized for failing to register as intermediaries. Previously, companies soliciting or receiving trading orders and passing them to a futures commission merchant (FCM) for a fee were required to register as intermediaries. However, in March, the CFTC issued a no-action letter to Phantom Technologies, indicating that the company would not face penalties even if it did not register as an intermediary.

Bloomberg pointed out that this exemption is one in a series of measures being pursued to expand the digital asset market in the United States.

This content was produced with the assistance of AI translation services.