The SEC tokenized stocks order issued on 17 September 2026 lets tokenized US shares trade without the venue registering as a stock exchange. The relief runs for five years and carries conditions including symbol and volume limits. It applies to shares listed on United States exchanges only.
What the SEC Actually Issued
The order creates a category of trading platform the Securities and Exchange Commission calls a Tokenized Securities Venue, or TSV, and exempts it from a single specific requirement.
That requirement is the definition of an “exchange” in the Securities Exchange Act of 1934. Normally, any venue that brings buyers and sellers of US-listed shares together must register as a national securities exchange, a demanding and expensive process. The exemption lets a TSV match buyers and sellers of tokenized National Market System stock — shares in US-listed companies represented as blockchain tokens — through permissioned automated market makers and liquidity pools instead.
An automated market maker is software that quotes prices from a pool of assets rather than matching individual buy and sell orders, which is how most blockchain trading venues already work. “Permissioned” means the venue controls who may participate.
The Commission published the decision as press release 2026-90 on 17 September 2026, alongside a request for public comment. The relief lasts five years from publication in the Federal Register.
The Conditions Attached to the Exemption
The exemption is conditional, and the conditions are the substance of the order rather than footnotes to it. The Securities and Exchange Commission’s announcement sets out what a venue must do.
- Symbol and volume limits: a venue may trade only a restricted set of symbols, with caps on volume. Commissioner Mark Uyeda said in a statement the same day that the caps are “calibrated by limit up, limit down tiers” — the existing US circuit-breaker bands that pause trading after sharp price moves.
- Identical rights: a tokenized share must carry the same rights as the ordinary share it represents.
- Issuer notice: a company must be given notice before a third party’s tokenized version of its stock begins trading.
- Auditable smart contracts: the code must be auditable, public, and deployed on permissionless ledgers.
- Halts must mirror: when trading in the underlying stock halts, trading in the token must halt too.
- Public disclosure: venues must disclose how they operate and what they are doing.
Uyeda listed the operating obligations as “public notice, transaction transparency, stoppage coordination, books and records, technology safeguards”. Firms supplying capital to a venue’s liquidity pools receive a separate conditional exemption from dealer registration.
What Does Not Change for Shareholders
The order does not suspend US securities law, and the Commission was explicit about that.
Chairman Paul Atkins wrote in his statement on the exemption that “the anti-fraud and anti-manipulation provisions of the federal securities laws apply in full to all securities activities in these markets”. Holders of a tokenized share remain shareholders of the underlying company, with the rights that attach to the ordinary stock.
Nor does the exemption change what a company is, what it reports or how it is supervised. It changes only how and where a share may be traded, and by whom that venue must be registered.
Why the SEC Acted When It Did
The order followed a failed vote in Congress by two days.
The CLARITY Act, which would have set a statutory framework for digital assets, fell in the United States Senate on Tuesday 15 September 2026 by 49 votes to 50, short of the 60 needed to advance, according to reporting by The TRADE. Atkins referred to the defeat directly, writing that “Congress was unsuccessful in advancing the CLARITY Act despite the tireless efforts of many”.
The Commission therefore used its own exemptive authority rather than waiting for legislation. Atkins described the result as temporary: “this interim measure must be followed by durable rulemaking to ensure that onchain markets remain a viable pathway as our capital markets continue to evolve.”
Who Objected
The order is contested by parts of the established US market structure, and those objections predate it.
The Securities Industry and Financial Markets Association, the main US trade body for broker-dealers and asset managers, had urged the Commission to refuse such relief, arguing it would let firms offer securities “outside of the regulatory structure established by the federal securities laws and from which many critical investor protections flow”. After the order, SIFMA warned it risked creating “parallel, but unequal trading ecosystems”, as reported by The TRADE.
The World Federation of Exchanges, whose members include Nasdaq, Cboe and CME Group, wrote to the Commission in November 2025 arguing that exemptions could dilute investor protections and distort competition. Cboe has argued the Commission should proceed by formal rulemaking rather than exemption. An earlier version of the plan was pulled in May 2026 after exchange operators raised market-structure and surveillance concerns.
Supporters argue the opposite case: that round-the-clock trading and faster settlement reduce counterparty risk and cost.
What Happens Next
As of 19 September 2026, the order is in force but the market it permits has still to be built, and several things are undecided.
- No framework is final: the order solicits public comment on whether the relief should be modified, extended or replaced by permanent rules.
- Venues must come forward: the Commission said a platform that believes it meets the definition need only notify the agency before it begins operating. The SEC has not published a list of venues operating under the exemption.
- The clock is running: the relief expires five years after publication in the Federal Register unless the Commission acts again.
This order applies to the United States. It does not change the rules for share trading in any other country.
Frequently Asked Questions
What Did the SEC Decide About Tokenized Stocks?
On 17 September 2026 it granted a five-year conditional exemption letting Tokenized Securities Venues trade tokenized US-listed shares without registering as national securities exchanges. The exemption carries conditions including symbol and volume limits.
Does the SEC Tokenized Stocks Order Change Shareholder Rights?
No. The order requires a tokenized share to carry the same rights as the ordinary share it represents, and Chairman Paul Atkins said the anti-fraud and anti-manipulation provisions of federal securities law apply in full.
How Long Does the Exemption Last?
Five years from publication in the Federal Register. The Commission has described it as an interim measure and said it must be followed by permanent rulemaking.
Which Countries Does the Order Apply To?
The United States only. It concerns National Market System stock, meaning shares listed on US exchanges, and does not alter share trading rules elsewhere.
Who Opposed the SEC Tokenized Stocks Exemption?
SIFMA, the World Federation of Exchanges and Cboe have all raised objections, arguing the relief could weaken investor protections or fragment the market. Supporters point to faster settlement and longer trading hours.
