The US Securities and Exchange Commission (SEC) gave implicit approval for some stocks and other securities to be tokenized and traded on blockchains.
Depository Trust & Clearing Corp. (DTCC), the world’s largest securities settlement system, said Thursday that a subsidiary, Depository Trust Co. (DTC), received a no-action letter allowing it to offer a tokenization service on approved blockchains for three years.
Tokenization is the process of representing stocks, bonds and other real assets (RWAs) as digital tokens that can be bought, sold and traded on blockchains for the purpose of greater efficiency and faster settlement.
Some of the biggest names in traditional finance (TradFi), including JPMorgan and BlackRock, have developed projects in this area that demonstrate the potential institutional investment they can draw on blockchain finance.
The Depository Trust Co.’s authorization applies to the constituents of the Russell 1000 Index, exchange-traded funds (ETFs) that track major indices and US Treasuries. It plans to start rolling out the service in the first half of 2026.
A no-action letter is a formal response from the agency to a business indicating that the regulator will not take any enforcement action on a proposed activity.
