SEC and Nasdaq Push to Tokenize U.S. Stocks: Instant Settlement and 24/7 Trading Could Be Coming
In one of its boldest moves yet, the U.S. Securities and Exchange Commission (SEC) is pushing forward with a plan that could fundamentally reshape financial markets: tokenizing U.S. stocks on blockchain networks. If approved, shares of companies like Apple, Tesla, and Nvidia would trade as digital tokens — a change that could bring crypto and Wall Street onto the same rails for the first time.
The proposal, backed by Nasdaq and supported by crypto-native firms like Coinbase and Robinhood, has triggered both excitement and pushback, with public comment on the plan set to close on October 14.
What’s Happening
Nasdaq has filed a rule change with the SEC to allow tokenized equities and exchange-traded products (ETPs). These would be traditional stocks, recorded and settled on a blockchain, but still carrying the same shareholder rights and protections as the underlying equity.
This isn’t about replacing stocks with “crypto coins.” It’s about upgrading the rails those stocks move on, replacing legacy settlement systems with blockchain-based ones.
How It Works
Tokenized shares: Stocks would be represented by digital tokens on a blockchain.
Same rights: Investors would still own the underlying stock, with the same voting and dividend rights.
New rails: Instead of settling trades through clearinghouses like the DTCC, settlement would occur directly on-chain — potentially in near real time.
This shift could turn the current two-day settlement cycle (T+2) into something close to instant settlement.
Why It’s Happening
The SEC and Nasdaq see tokenization as a solution to long-standing inefficiencies:
Efficiency & speed: Instant settlement reduces counterparty risk.
Cost savings: Cutting out middlemen like clearinghouses lowers transaction costs.
Global access: Tokenized shares could be available 24/7, unlocking U.S. markets for international investors.
At the same time, the rise of blockchain in traditional finance — from BlackRock’s tokenized funds to Franklin Templeton’s blockchain-based money market products — has created momentum regulators can no longer ignore.
Support vs. Resistance
Supporters:
Nasdaq — driving the rule change.
Coinbase & Robinhood — see tokenized equities as a natural extension of crypto trading.
SEC Commissioner Hester Peirce — supportive but clear that tokenized shares remain securities.
Opponents:
Citadel Securities & DTCC — risk losing billions in settlement and custody fees.
World Federation of Exchanges (WFE) — warns tokenized equities could “mimic” stocks without sufficient oversight.
This clash sets up a classic battle: innovation vs. incumbency.
Why This Is a Big Deal
Faster settlement → goodbye T+2 delays, hello instant settlement.
Lower costs → fewer fees for brokers, custodians, and clearing firms.
Global market access → U.S. equities available around the clock, similar to crypto.
Crypto validation → blockchain cemented as a backbone of global finance.
But risks remain:
Tokenized stocks must fully comply with U.S. securities laws.
Liquidity may be uneven at first.
Large-scale adoption is still in its early stages.
What It Means for Crypto Investors
For the crypto space, this is more than a regulatory milestone — it’s validation.
Legitimacy: Blockchain isn’t just for Bitcoin anymore; it’s for Apple and Tesla, too.
On-ramps multiply: Platforms like Coinbase could expand beyond crypto into equities, blurring the line between stock brokerages and crypto exchanges.
Tokenization boom: If stocks can be tokenized, so can bonds, real estate, commodities — fueling demand for infrastructure blockchains like Ethereum, Solana, and XRP Ledger.
Final Take
The SEC’s blockchain stock-trading proposal is not a question of “if,” but “when.” Wall Street may resist, but momentum is moving toward a hybrid financial system where stocks and crypto trade side by side on the same digital infrastructure.
For retail investors, this isn’t just about seeing Apple shares as tokens. It’s about the dawn of a market that’s faster, cheaper, and more accessible — where crypto and traditional finance finally converge.