SEC Plans New Rules for Digital Versions of Public Stocks

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The SEC is preparing a new framework that could allow crypto platforms to trade tokenized versions of public stocks, marking one of the biggest shifts yet between Wall Street and blockchain infrastructure. The agency may release its “innovation exemption” very soon under the Trump administration’s crypto-friendly regulatory approach. The move could open the door to 24/7 trading of tokenized equities across centralized and decentralized crypto markets.

SEC Pushes Tokenized Stocks Closer To Reality

The proposed framework, shared in a report on May 18, would reportedly allow digital versions of securities to trade on crypto rails instead of traditional stock market infrastructure.

Under SEC Chair Paul Atkins, regulators have increasingly signaled support for tokenization, particularly around on-chain trading systems and blockchain-based settlement. Another report said that regulators may allow some tokenized stocks to trade without direct backing or approval from the underlying public companies.

This detail is important as these assets may not carry traditional shareholder rights like voting power or dividends. Instead, they would function more like blockchain-based price exposure products tied to publicly traded equities.

Still, the market reaction across crypto has been strongly positive.

Renowned DeFi analyst Ignas said the development could benefit projects tied to tokenization and on-chain finance, including Ondo Finance (ONDO), Centrifuge (CFG), Pendle (PENDLE), Hyperliquid (HYPE), Aave (AAVE), Morpho (MORPHO), and Fluid (FLUID). Lending protocols that accept tokenized collateral could also see higher activity if tokenized securities become more widely available.

Wall Street And Crypto Infrastructure Continue Merging

The announcement fits into a much larger push around tokenized assets in the United States.

Research shared by Token Terminal argued that the US is effectively “all in” on tokenization because it benefits both government financing and corporate capital markets. Tokenized dollars increase demand for Treasuries, and tokenized securities expand access to U.S. financial markets globally.

Despite the excitement, tokenized stocks remain a relatively small segment of the wider real-world asset (RWA) market. Data from RWA.xyz shows tokenized equities account for about $1.43 billion in value, or just over 4% of tokenized RWAs on-chain.

Tokenized US Treasuries still dominate the sector, and Ethereum (ETH) and its layer-2 networks continue controlling most tokenized asset activity.

Nonetheless, the SEC’s upcoming framework could accelerate the shift from tokenization experiments into fully regulated crypto market infrastructure.