The SEC was supposed to release its framework for letting crypto platforms trade tokenized versions of US stocks sometime between May 18 and 22. That didn’t happen.
The agency has postponed its “innovation exemption” after receiving pointed feedback from traditional stock exchanges and other market participants who raised concerns about investor protection and what they see as an uneven competitive playing field.
What the framework would have done
The proposed exemption was designed to let crypto platforms and decentralized finance protocols trade blockchain-based representations of public equities, think tokenized shares of Apple, Tesla, and Nvidia, under streamlined regulations. The framework included some genuinely ambitious features: 24/7 trading, fractional ownership, and rapid settlement.
Perhaps most controversially, the draft would have allowed third-party tokenization without requiring consent from the company whose stock was being tokenized. In English: someone could create a blockchain version of Tesla stock and trade it on a crypto exchange without Tesla signing off on it.
