SEC Prepares 'Innovation Exemption' to Allow 24/7 Blockchain Trading of Tokenized Stocks
The U.S. Securities and Exchange Commission (SEC) is preparing an "innovation exemption" framework that will allow tokenized stocks to be traded around the clock via blockchain.
This framework will enable crypto platforms to offer tokenized versions of publicly traded U.S. stocks, bypassing some traditional brokerage requirements, facilitating 24/7 trading and faster settlement.
Tokenized stocks must retain the same rights and protections as traditional stocks.
The exemption is positioned as a limited and temporary experiment, rather than a comprehensive replacement of existing market infrastructure.
Related proposals are expected to be announced soon, sparking discussions about the potential impact on market structure.
Mechanically, the policy is driven by innovation in tokenized assets and regulatory adaptation, with funds and trading volume potentially flowing to platforms supporting on-chain stocks; beneficiaries include crypto trading platforms and liquidity-seeking investors, while traditional trading hours and settlement systems may face pressure.
Currently, traditional stock markets operate within limited hours on weekdays.
Source: Public Information
ABAB AI Insight
The SEC, under new leadership, is advancing the innovation exemption aimed at providing a regulatory sandbox for tokenized securities, combining blockchain trading with traditional stock rights in response to the crypto industry's demand for a 24/7 market.
In terms of capital pathways, the exemption will lower the compliance barriers for crypto platforms entering stock tokenization, motivated by the desire to promote experimental innovation while preserving investor protection, with resources from regulatory flexibility directly transforming into potential new trading venues.
Similar cases can be seen in other jurisdictions piloting tokenized securities, as well as the current trend of integration between traditional finance and blockchain infrastructure, with the U.S. stock market structure exploring a transition from fixed hours to potential 24/7 trading.
Structural judgments belong to regulatory changes, with mechanisms allowing temporary exemptions to bypass some existing rules, permitting on-chain trading experiments that may gradually alter settlement speeds and trading time boundaries.
ABAB News · Cognitive Law
- Innovation exemption is the key to opening the door to tokenization.
- 24/7 trading will reshape the time boundaries of stock liquidity.
- Equal rights are a prerequisite for the acceptance of tokenized stocks.