Key Takeaways
- SIFMA stated that the issues surrounding tokenised equities are too significant to be decided through individual relief applications.
- SIFMA cited growing reports that several crypto platforms are pursuing no-action or exemptive relief to allow them to offer tokenised equities or securities.
The Securities Industry and Financial Markets Association (SIFMA) has formally requested that the U.S. Securities and Exchange Commission (SEC) deny attempts by crypto firms to obtain exemptions or no-action relief for offering tokenised securities. The trade association, which represents major players in the traditional finance sector, addressed its concerns in a letter to the SEC’s Crypto Task Force earlier this week.
SIFMA cited growing reports that several crypto platforms are pursuing no-action or exemptive relief to allow them to offer tokenised equities or securities. The organization urged the Commission to reject these requests, warning that permitting such exemptions could erode investor protections enshrined in federal law.
In the letter, SIFMA stated that the issues surrounding tokenised equities are too significant to be decided through individual relief applications. It called instead for a comprehensive public rulemaking process. No-action relief would mean the SEC agrees not to pursue enforcement actions against companies offering these products. Exemptive relief would allow firms to test tokenised securities outside the existing regulatory regime. SIFMA warned that both paths risk circumventing oversight mechanisms essential to the traditional markets.
“The SEC should reject such requests to make significant changes to the regulatory structure for the securities markets under the federal securities laws through immediate no-action or exemptive relief in lieu of a more substantive notice and comment process,” SIFMA said.
The timing of the letter follows recent activity in the digital asset space. Kraken began offering tokenised shares of major U.S. companies this week, though the service remains unavailable to users in the U.S., EU, UK, Canada, and Australia. Coinbase also recently indicated that tokenised stocks are a top priority for its legal and product teams.
The SEC’s Crypto Task Force, established earlier this year under Commissioner Hester Peirce, is currently reviewing various proposals tied to tokenised assets, including exchange-traded funds based on SOL, XRP, and DOGE. In a speech last month, Peirce acknowledged the potential need for exemptive orders to break the “chicken-and-egg” cycle that currently limits tokenised securities trading.
