SEC Grants Five-Year Exemption For Tokenized Stock Trading Venues

The U.S. Securities and Exchange Commission (SEC) has issued a five-year "Innovation Exemption" allowing qualifying venues to facilitate the trading of tokenized National Market System stocks. This temporary relief permits the use of permissioned automated market makers and liquidity pools, provided that the tokenized shares offer holders the same rights as conventional stocks. The exemption includes strict conditions, such as requirements for auditable smart contracts on public ledgers and mandatory trading halts if the underlying stock is suspended on its primary exchange. This move represents a significant step toward integrating public-company shares into on-chain infrastructure while maintaining regulatory oversight.