Nasdaq has filed a proposal with the U.S. Securities and Exchange Commission to allow trading of tokenized securities—financial assets transformed into blockchain-based digital tokens—on its main market. This move, if approved, would make Nasdaq the first major U.S. stock exchange to embrace tokenized securities, blending traditional and digital finance within the existing national market system.
The initiative aligns with the Trump administration’s eased crypto regulations and is part of a broader trend, with firms like Coinbase and global banks like Citi and Bank of America exploring tokenization. Nasdaq emphasizes that tokenized assets must offer the same material rights as traditional securities to be treated equivalently and traded under the same rules. If those rights aren't fully preserved, they will be treated as distinct instruments.
The exchange aims for a seamless integration, allowing token-settled trades without altering traditional order handling or surveillance practices. The first such trades could occur by Q3 2026, pending the readiness of the Depository Trust Company’s infrastructure. The SEC, under new leadership, is also reworking crypto regulations, signaling a significant shift toward integrating blockchain into traditional finance.
This development comes amid a surge in cryptocurrency adoption and innovation, with major financial institutions and exchanges exploring ways to integrate digital assets into their offerings. The move by Nasdaq reflects a growing recognition of the potential of blockchain technology to transform financial markets and the need for regulatory frameworks that accommodate these advancements.
As the SEC reviews Nasdaq's proposal, the outcome could set a precedent for other exchanges and financial institutions considering the integration of tokenized securities, potentially reshaping the landscape of financial trading and investment.
