Nasdaq Accelerates Push for SEC Approval on Tokenized Stock Trading

• Nasdaq is prioritizing SEC approval for its plan to list tokenized versions of stocks.
• The exchange aims to move quickly while responding to regulatory feedback.
• Nasdaq stresses that tokenization will build on current market structures, not replace them.

Nasdaq has placed the approval of its tokenized-stock proposal at the top of its agenda. The exchange wants permission to let investors trade digital versions of listed shares. Its digital assets chief, Matt Savarese, explained that the team is preparing for a swift back-and-forth with regulators. He noted that public comments will guide the next steps, and the exchange intends to answer every regulatory question as soon as it arrives.

Savarese said the goal is clear: keep the process moving and stay aligned with the pace of the Securities and Exchange Commission. The proposal was submitted on Sept. 8 and outlines a path for allowing stock tokens on the exchange. These tokens would act as digital representations of traditional shares, giving investors another regulated way to access familiar assets without changing how those assets work at their core.

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Nasdaq Advances Tokenization Under SEC Guidelines

Nasdaq’s firm belief is that the plan is not intended to break down existing market frameworks. According to Savarese, the exchange’s belief is that the development of tokenization must be able to evolve within existing frameworks that investors are familiar with.

The exchange views this system as promoting trust and minimizing friction for market players. Additionally, the experience of Nasdaq builds its confidence. It was a pioneer when the transition from trading through paper to electronic platforms occurred. It sees the adoption of tokenized stocks as a progression.

However, from the conversations across the industry, there is a mix of reactions. While for some, these tokenized stocks form the next revolution of innovative financial technology; others feel that the effect is likely to be confined to the crypto networks that experience massive inflows from these tokenized assets.

Tokenized Stocks Gain Traction Amid Industry Debate

Supporters point to recent milestones. Galaxy Digital, for instance, is able to tokenize its own stocks on a prominent blockchain after launching on Solana. People who favor this development believe, therefore, if stocks become digital, the market can become even more efficient.

Skeptics remain careful. Certain venture investors have voiced warnings that the value stream from these tokenized stocks may never trickle back to the original crypto platforms. They observe that if layer-2 networks become popular, business may trickle to numerous platforms, thus defying the original futuristic advantages for original blockchains.

Despite this claim, Nasdaq is still pointing to the importance of ‘tokenization’ as a natural progression. The company is working to implement this type of technology, even as they attempt to stabilize their non-GME market.

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