Peirce narrows hopes for broad tokenized-stock exemption
SEC Commissioner Hester Peirce told crypto firms to temper hopes for a broad tokenized-stock exemption, saying relief would cover only digital versions of existing shares, not synthetic tokens.
SEC Commissioner Hester Peirce posted on X this week that any innovation exemption would be limited to “digital representations of the same underlying equity security that an investor could purchase in the secondary market today.” She added she does not expect synthetic tokens to be included.
The limitation would exclude tokens created by third parties that only track a stock’s price rather than carry the stock’s economic or governance rights.
Industry leaders responded. Brett Redfearn, president of tokenization firm Securitize, warned that allowing third parties to mint tokenized shares “without an issuer at the table” could fragment ownership and complicate markets. Carlos Domingo, Securitize’s chief executive, noted a narrower exemption would reduce ownership fragmentation and curb derivative tokens. Robert Leshner, CEO of tokenization platform Superstate, added a stricter carve-out would let decentralized finance and tokenization grow “without compromising the standards that make the USA the center of capital markets.”
On-chain tokenization remains modest in scale. Data from RWA.xyz shows about $1.48 billion of stocks are tokenized on-chain, including holdings tied to Circle, the Bitcoin investment firm Strategy, and Alphabet (GOOG). Forecasts from Standard Chartered had projected a potential $4T tokenized assets on-chain by 2028.
The SEC has solicited feedback from market participants and officials say rule details are not finalized and could change. Some agency staffers do not support permitting tokenized stock trading, reflecting internal debate over market structure, investor protection and technical features of blockchain-based securities.
Peirce’s remarks clarify the types of tokens the agency is likely to consider: instruments that mirror ordinary shares’ economic and governance features, such as voting rights and dividend entitlements, rather than tokens that only track price. That distinction will shape which firms can offer tokenized equities and how custody, transfer and corporate governance are handled as on-chain trading develops.
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