Nasdaq emphasized the importance of clear labeling for tokenized securities to ensure proper processing by clearing and settlement entities like the Depository Trust Company. T
Crypto Regulatory News
Nasdaq has filed a rule change request with the SEC to enable trading of tokenized stocks alongside traditional securities on regulated exchanges. The proposal could bring blockchain-based settlement into the national market system by Q3 2026 if approved.
The exchange operator specifically requested amendments to security definitions, allowing tokenized versions to trade under identical execution and documentation rules as conventional stocks. Tokenized assets would receive equivalent priority in order execution systems.
Nasdaq emphasized the importance of clear labeling for tokenized securities to ensure proper processing by clearing and settlement entities like the Depository Trust Company. The filing requires tokenized shares to carry identical rights and privileges as underlying securities.
The proposal positions regulated exchanges against "siloed trading venues" where investors lack consolidated price discovery across markets. Nasdaq argued that tokenized securities trading must occur within established market infrastructure rather than separate platforms.
Congress is considering tokenization rules under broader crypto market structure legislation spanning SEC and CFTC jurisdictions. The framework would address custody standards, auditing requirements, and reporting obligations for blockchain-based assets.
Wall Street institutions, including Citadel Securities, previously advised the SEC to maintain securities rules without broad exemptions. The focus remains on preserving market liquidity while ensuring standard investor protections apply to tokenized assets.
Nasdaq expressed concerns about European platforms offering tokenized U.S. equities without full shareholder rights including voting privileges. These platforms purchase and hold traditional shares while providing users with limited digital rights.
Major financial institutions are exploring similar initiatives, with JPMorgan discussing tokenized deposits and Coinbase reportedly considering tokenized equities within its exchange expansion plans. Banks and crypto firms are targeting real-world asset migration to blockchain infrastructure.
The rule change represents a significant step toward mainstream blockchain adoption in traditional financial markets. If approved, U.S.-regulated exchanges could list tokenized shares, potentially boosting liquidity for blockchain-based securities.
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