The U.S. Securities and Exchange Commission (SEC) has postponed a proposal that could have eased rules for crypto companies seeking to trade digital tokens linked to publicly listed shares, following concerns raised by major players across financial markets.
A report by Bloomberg indicated that agency officials had been preparing to introduce what was described as an “innovation exemption,” a policy designed to create a more flexible route for crypto firms handling tokenized equities. Internal discussions had reportedly progressed far enough for a draft version to be completed and circulated within the regulator, with expectations that an announcement could come as early as this week.
That timeline shifted after officials reviewed feedback submitted by exchange operators and other financial participants, leading the agency to continue reviewing concerns rather than moving ahead immediately.
If adopted, the proposal would have created a more flexible route for digital asset platforms and decentralized finance systems to offer blockchain representations of listed companies such as Apple and Tesla. These assets would still fall under securities classification, but with fewer procedural constraints than traditional listings.
It also envisioned continuous market access throughout the day, faster settlement after trades, and simplified fractional ownership of shares. In some cases, these tokens could circulate without direct approval from the underlying corporations.
Opposition has been firm from major financial players, who sent critical letters to the SEC months before the latest delay expressing concern over the plan. They warned that splitting activity between blockchain venues and regulated exchanges could reduce liquidity and disrupt how prices are formed.
They also pointed to investor protection risks, especially when third parties issue tokens that may not provide standard shareholder benefits like dividend participation or voting rights.
Interest in tokenized real-world assets continues to grow despite the regulatory uncertainty. Market data shows the sector has climbed beyond $34 billion in value, representing a 1,600% growth over the last two years. Tokenized stocks alone have crossed the $1 billion threshold.
The SEC, led by Paul Atkins, has engaged a wide range of stakeholders in discussions aimed at balancing innovation with market safeguards. Although the plan is currently paused, officials have not ruled out revisiting it later this year.
No updated schedule has been announced, but the framework remains under consideration and could return in a revised form that reshapes how U.S. equity markets connect with blockchain infrastructure.
Crypto industry players like Riot Blockchain Inc. (NASDAQ: RIOT) will continue to watch what regulatory plan the SEC eventually publishes to guide how tokenized assets can be traded alongside the traditional stocks of those companies.
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