Key Highlights
The SEC approved Nasdaq’s rule change to allow tokenized versions of equities and ETFs to trade on the same order books as traditional shares.
Tokens settle through the Depository Trust Company (DTC) and remain fully fungible with identical tickers, CUSIPs, voting rights, and dividend entitlements.
The move supports faster settlement, fractional ownership, and 24/7 trading potential while maintaining existing surveillance and reporting standards.
The U.S. Securities and Exchange Commission has approved a rule change proposed by Nasdaq, enabling the exchange to offer tokenized versions of equity securities and ETFs on its platform. The tokenized instruments will use blockchain settlement through the DTC while remaining fully compatible with conventional shares.
Under the framework, tokenized securities will trade on the same order books as standard shares, with the same execution priority, ticker, and CUSIP identifiers. Investors who wish to participate can opt in through a designated flag. Nasdaq surveillance and reporting systems will monitor activity to preserve market integrity, while DTC handles token creation and settlement.
Nasdaq highlighted benefits, including faster settlement (potentially T+0), fractional-share access, and extended trading hours. The approval also places Nasdaq in a competitive position alongside NYSE pilots and international tokenization initiatives.
The decision follows the SEC’s 2026 guidance on tokenized securities and a prior DTCC no-action letter, signaling growing regulatory clarity for blockchain-based trading. Industry groups such as SIFMA expressed support, while some, including Ondo Finance, raised concerns over operational and market risks. If infrastructure is ready, live trading could start in Q3 2026.
