SEC to make ‘innovation exemption’ for tokenized stock trading: Report

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Bullish, the crypto exchange led by former NYSE president Tom Farley, also strengthened its tokenization capabilities earlier this month with its $4.2 billion acquisition of transfer agent platform Equiniti. Backers of tokenized stock trading have also said the technology can promote financial inclusion by enabling individuals without access to US markets or traditional brokerage accounts to gain exposure to public companies including Nvidia (NVDA), Google (GOOGL) and Tesla (TSLA). Related: Kraken parent Payward sees revenue surge as tokenization expands Despite the expected exemption, some SEC officials do not support the decision to allow tokenized stock trading, according to the sources. Cointelegraph reached out to the SEC for comment but did not receive an immediate response. Meanwhile, Brett Redfearn, president of one of the biggest crypto-native tokenization platforms, Securitize, expressed concerns over the SEC’s expected exemption, arguing that enabling third parties to tokenize stock “without an issuer at the table” could lead to fragmentation issues. It could leave investors less certain over what their shares are worth, Redfearn said. Source: Securitize Tokenized trading has also expanded into the pre-IPO space, enabling investors to gain exposure to sought-after private companies before they go public. However, some of these companies, including OpenAI and Anthropic, have opposed unauthorized tokenized stocks tracking their valuations. The SEC’s tokenization move comes after the Senate Banking Committee advanced the CLARITY Act on Thursday, setting it up for a full Senate floor vote next month. Several industry pundits, including “Shark Tank” investor Kevin O’Leary, have said Wall Street firms won’t fully embrace tokenization unless there is a framework like the CLARITY Act in place and that issues over ownership are ironed out. Magazine: eToro founder timed Bitcoin top perfectly due to belief in 4 year cycles More on the subject

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