TechFlow News, March 25: According to The Block, the U.S. House Committee on Financial Services held a hearing on “Tokenization and the Future of Securities: Modernizing Capital Markets.” Meanwhile, the U.S. Securities and Exchange Commission (SEC) is preparing to launch an innovative exemption framework for tokenized assets, which may operate as a regulatory sandbox for on-chain assets.
SEC Chair Paul Atkins stated that the agency will solicit public input on issues related to future rulemaking. Previously, the SEC has approved several initiatives involving tokenized securities: In December last year, it authorized the Depository Trust & Clearing Corporation (DTCC) to tokenize certain highly liquid assets on pre-approved blockchains; the New York Stock Exchange (NYSE) announced plans to develop a platform for trading tokenized securities and on-chain settlement; and Nasdaq has also received SEC approval for rule changes to support tokenized stock trading.
At the hearing, several members of Congress expressed reservations. Representative Brad Sherman voiced concern that the exemption framework could create a “dual-track market,” enabling tokenized securities on blockchains to bypass core securities regulations. Representative Maxine Waters cited lessons from the 2008 financial crisis, questioning whether tokenization would genuinely benefit investors—or primarily serve “intermediaries”—and raised concerns regarding former President Trump’s potential conflicts of interest related to cryptocurrency.
