TLDR
- SEC approved Nasdaq’s plan to trade tokenized stocks and ETFs under existing market rules.
- Tokenized securities will have the same price, ticker, and investor rights as traditional shares.
- Trades will be cleared and settled through the Depository Trust Company system.
- Program includes Russell 1000 stocks and major ETFs like S&P 500 trackers.
- Launch depends on completion of DTC pilot infrastructure and 30-day notice.
The U.S. Securities and Exchange Commission has approved Nasdaq’s proposal to introduce tokenized securities trading, allowing certain stocks and exchange-traded funds to be issued and settled in tokenized form. The approval, confirmed in a regulatory filing, enables Nasdaq to move forward with a pilot program that integrates blockchain-based settlement into traditional equity markets while maintaining existing regulatory standards.
The program applies to securities classified as “DTC Eligible Securities,” including stocks listed in the Russell 1000 Index and ETFs tracking major benchmarks such as the S&P 500 and Nasdaq-100. These assets will be eligible for tokenized settlement without altering their core characteristics. The SEC stated that the proposal meets the requirements of the Securities Exchange Act of 1934, confirming that the structure aligns with current market rules.
🚨NEW: The @SECGov has approved @Nasdaq’s plan to introduce tokenized trading for certain securities.
The move will allow participants to opt to have trades in Russell 1000 stocks, as well as ETFs tracking the S&P 500 and Nasdaq 100, settled as tokenized securities rather than… pic.twitter.com/NPVjcXJxup
— Eleanor Terrett (@EleanorTerrett) March 19, 2026
Under the framework, tokenized securities will operate identically to traditional shares. They will retain the same ticker symbols, carry the same CUSIP identification numbers, and provide identical investor rights, including dividends and voting privileges. The trading process will remain unchanged in terms of pricing, order execution, and fees, with tokenization affecting only the settlement layer.
Structure and settlement process for tokenized securities
The system introduces an optional mechanism for traders who prefer blockchain-based settlement. Market participants can select tokenized settlement by adding a “tokenization flag” when placing an order, along with specifying a blockchain network and wallet address. Once the trade is executed, the transaction details will be forwarded to the Depository Trust Company, which will handle clearing and settlement under its ongoing pilot program.
Both tokenized and traditional trades will operate on the same order book, ensuring uniform pricing and execution. There will be no distinction in how trades are matched or processed, aside from the settlement method chosen by the participant. Oversight will continue under existing frameworks, with Nasdaq and the Financial Industry Regulatory Authority monitoring trading activity using established systems.
The rollout of tokenized securities will depend on the completion of infrastructure within the Depository Trust Company’s pilot. Trading will not begin until that process is finalized. Nasdaq is also required to provide at least 30 days’ notice to market participants before launch through an Equity Trader Alert.
Regulatory alignment and pilot scope
The SEC’s approval follows Nasdaq’s initial submission of the proposal in September, along with subsequent amendments and public feedback. The regulator determined that the proposal maintains investor protections, including transparency, reporting standards, and surveillance mechanisms. The structure ensures that tokenized securities remain subject to the same compliance requirements as their traditional counterparts.
The pilot program is limited in scope and does not introduce new types of securities. Any expansion beyond the initial framework, or changes to how tokenization is implemented, will require additional regulatory approval. This approach allows the market to test tokenized settlement within a controlled environment while maintaining oversight.
The inclusion of widely traded securities, such as those in the Russell 1000 and major ETFs, reflects a focus on established assets rather than experimental instruments. By limiting the pilot to these categories, Nasdaq aims to integrate tokenization into existing market infrastructure without altering the underlying structure of equity trading.
Tokenization trend expands across financial markets
The approval comes as tokenization of traditional financial assets continues to gain traction. Exchanges and financial institutions have been exploring blockchain-based systems to streamline settlement processes and improve operational efficiency. Tokenized securities are designed to represent ownership of real-world assets on a blockchain while maintaining regulatory compliance.
Nasdaq’s initiative is part of a broader movement among major exchanges. The company has also been working on frameworks that would allow publicly listed companies to issue blockchain-based versions of their shares. Partnerships with digital asset platforms are being explored to expand access to tokenized equities across global markets.
Other institutions have also entered the space. Intercontinental Exchange, the parent company of the New York Stock Exchange, has invested in digital asset infrastructure with plans to develop tokenized products. These developments indicate a growing focus on integrating blockchain technology into traditional financial systems.
