- The latest report indicates that the US Securities and Exchange Commission is expected to do so Offering exemptions for new innovations for token shares this week or later.
- This comes after the Securities and Exchange Commission (SEC) approved proposals from Nasdaq and the New York Stock Exchange (NYSE) to allow tokenized shares to be traded on their platform.
- Total value for The value of the token shares crossed the $1.5 billion mark.
Amidst the astonishing progress in the regulatory framework for digital assets, a major report has been released from the main regulatory agency, the US Securities and Exchange Commission, which plans to approve a tokenized version of stock and ETF trading with new rules.
According to the latest report, the SEC is expected to provide exemptions for new token stock innovations this week or later.
In March, the SEC gave the green light to a proposal from Nasdaq that would allow tokenized securities to be traded on its platform. A month later, in April, similar approval was also granted to the New York Stock Exchange (NYSE). These successive approvals will allow investors to trade tokenized versions of real stocks as well as exchange-traded funds (ETFs) on the largest regulated exchanges. These regulatory approvals will open the door for blockchain technology to enter the traditional stock trading market.
What are token shares?
Tokenized stocks are blockchain-based digital versions of real company stocks, such as Apple, Nvidia, or S&P 500 ETFs. Each tokenized copy of a stock on the blockchain will be backed by real underlying shares that are stored in a secure location.
While its critics raise questions like why one should trade token stocks, there are several benefits that these token stocks have. These token shares can be executed on the same day instead of the current traditional T+1 system, which takes a full day to settle the trade.
According to the recent clarification issued by the SEC regarding tokenized securities, tokenized shares will follow the same. Federal securities laws Like traditional stocks
The Securities and Exchange Commission reported in Official statement That “one class of securities may be issued in multiple formats, including a premium format. Likewise, an issuer may permit holders of securities to hold securities in various formats and convert the security from one format to another. The format in which the security is issued or the methods by which holders of the securities are registered (For example(onchain vs. offchain) Does not affect enforcement of federal securities laws.
“For example, regardless of its form, the Securities Act requires that every offer and sale of securities must be registered with the Commission unless an exemption from registration is available. Likewise, stocks are ‘equity securities’ under the Securities Act and the Exchange Act regardless of their form,” the report added further.
Token shares cross $1.5 billion mark as demand grows
Amid increasing regulatory clarity and adoption of blockchain-based digital assets, the token market has witnessed impressive growth in the past few months. According to official data rwa.xyzThe total distributed value of token shares has risen to more than $1.5 billion. Last year, in May, the total value of tokenized issues of shares was around $300 million.
The sharp growth in the tokenized version of shares came after the increasing demand for it among investors, as it became widely accepted among traditional traders. These token shares overcome the limitations found in the traditional stock trading market, such as time constraints.
According to leading forecasting market, Polymarket’s last contractThere is approximately a 75% chance that the total real-world asset market will reach $50 billion by December 31, 2026. This includes stocks, bonds, and token funds.
Along with tokenized shares, the total tokenization of assets in the real world has seen sharp growth in the past few months. according to challengeThe total market capitalization of real-world on-chain assets is currently around $30 billion following recent growth in demand with institutional adoption from BlackRock, Franklin Templeton, Ondo Finance and Circle.
Tokenized US Treasuries are the largest class in the real-world asset market, with current data indicating that the total value of tokenized US Treasuries has risen by more than $15.49 billion.
Ondo Finance recently announced that it is Launch bridge To bring popular token stocks to Hyperliquid HyperEVM. These stocks include SPY, Tesla, and Nvidia. Ondo Finance uses LayerZero technology to form this bridge between its platform and the Hyperliquid ecosystem. This product will allow traders to trade spot token shares alongside futures contracts on the same blockchain network.
Leading Cryptocurrency exchangeKraken, launched the xStocks platform in partnership with Backed. This platform contains about 50 major US stocks and ETFs, including TSLAx, AAPLx, and SPYx. The platform is connected to several blockchain networks, including Solana, Ethereum, TON, Ink, and others such as BNB Chain and TRON through the xStocks alliance.
Traditional trading groups raise questions about tokenized stocks
The Securities Industry and Financial Markets Association (SIFMA) has raised its support for the token shares after initially raising concerns.
the Official letter It stated that “SIFMA members have read with great concern recent reports indicating that certain digital asset companies have filed requests for no immediate action or relief from requirements under the federal securities laws to allow these companies to provide investors with the ability to purchase and trade tokenized shares or other digital forms of traditional securities through the companies’ platforms.”
However, in March, SIFMA stated that it welcomes new tokenization-based innovations. “SIFMA and its members strongly support innovation in the securities markets and believe that new technologies such as distributed ledger technology (“DLT”) and tokenization provide many potential benefits to the United States. male In the last certificate.
Cboe Global Markets also raised objections and urged clear regulatory clarity for the sector. Cboe has asked regulators to disclose more details about the role of the Depository Trust Company (DTC) in the tokenization trial and in the process of settling trades after its implementation.
Earlier, Cboe Bank raised questions about several uncertainties about how traditional shares are converted into tokenized issues, as well as how these tokenized shares are settled.
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