US SEC Weighs Onchain Trading Path as Atkins and Peirce Detail New Exemption

TL;DR

• SEC plans an innovation exemption for limited tokenized securities trading.

• Nasdaq and DTCC explore tokenized equities as activity accelerates.

• Kraken reports $25B lifetime tokenized stock volume through its xStock product.

• Atkins says the SEC will prioritize rulemaking instead of reacting to price moves.

SEC Commissioner Hester Peirce and SEC Chair Paul Atkins shared new details on a proposed innovation exemption for tokenized securities. They spoke at ETHDenver during a public interview. The exemption would permit limited trading of tokenized securities on new platforms while regulators build a long-term framework.

Atkins said the plan aims to “facilitate limited trading of certain tokenized securities on novel platforms.” He said the goal is to support testing while the agency studies broader rules. Peirce added that the exemption would not reshape the market quickly. She said it “would be an important step,” yet it would not change the system overnight.

The discussion arrives as both crypto firms and traditional institutions expand work on tokenized equities. Nasdaq and DTCC have tested tokenization models during the past year. DTCC also received approval to tokenize certain liquid assets under a three-year authorization period.

Growing Market Activity Drives Industry Demand for Clear Rules

The rise of tokenized stock platforms has increased interest in regulatory plans. Kraken reported about $25 billion in lifetime trading volume in its xStock product. Robinhood’s real-world-asset blockchain processed more than four million transactions in its first week.

The New York Stock Exchange said it is building a platform for onchain settlement of tokenized securities. The plan would enable trading at any time of day. This matches growing demand for faster settlement and broader market access.

Peirce said some traditional finance groups are uneasy about exemptions that could support crypto firms. She said both sides may discover that the exemption is less dramatic than expected. She added that it would create room for testing rather than large shifts.

Regulators Emphasize Framework Over Market Volatility

Atkins spoke about current market pressure as Bitcoin slipped to about $66,000. He rejected calls for emergency steps during the downturn. He said, “It is not the regulator’s job to worry about the daily swings of the markets.” He added that those focused only on price moves may be disappointed.

XRP fell near $1.40, and Ethereum moved below $2,000 during the slide. Yet Atkins said regulators must continue work on long-term structures rather than respond to each drop. He said the SEC is developing rules under “Project Crypto,” a joint plan with the CFTC.

The agenda includes asset classification, custody guidance and paths for tokenized trading on automated market makers. The agency has ended several ongoing cases and issued staff guidance on mining, staking and meme coins.

Innovation Exemption Could Allow Limited Onchain Testing

Atkins said market participants should have the option to trade certain tokenized securities through automated market makers. He said some users will prefer decentralized applications on public blockchains. Yet he also said many Americans may still choose intermediaries for trading and custody.

Peirce said regulatory clarity must be paired with real products. She said builders must create systems that people want and will use. Atkins added that developers should “come in and talk to us” as the agency prepares an exemption with volume limits.

He said progress depends on continued development within the industry. He told the audience to keep working on tools that matter because strong products can support adoption.

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