SEC clears tokenized ETF plan
NASDAQ’s plan to list tokenized S&P/NASDAQ ETFs inside traditional order books received SEC approval, signaling a practical step toward integrating tokenization with existing equity market infrastructure. That approval ties tokenized instruments to mainstream market plumbing rather than forcing them into siloed venues. (x.com)
The SEC issued an order (Release No. 34‑105047) approving Nasdaq’s SR‑NASDAQ‑2025‑072 rule change on March 18, 2026. (sec.gov) The approval is conditioned on operation “during the pendency of a tokenization pilot program” run by the Depository Trust Company (DTC), a pilot that the SEC staff authorized by no‑action letter on December 11, 2025. (sec.gov) DTC has scoped the pilot to a limited set of eligible securities, which public filings and exchange commentary identify as large‑cap Russell 1000 stocks and major index ETFs (examples cited include S&P‑500 and Nasdaq‑100 trackers) for a controlled roll‑out. (hoodline.com) Nasdaq’s approved rule text requires tokenized versions to be fungible with conventional shares, to carry the same trading symbol and CUSIP, to occupy the same order book and execution priority, and to remain subject to existing market surveillance and Consolidated Audit Trail reporting. (sec.gov) Operational mechanics described in the filings and market coverage specify a market participant “tokenization flag” on orders; when a flagged trade executes, Nasdaq will pass the instruction to DTC, which mints a token to a registered DTC wallet and reconciles a control account, with explicit fallbacks to standard processing where on‑chain settlement cannot occur. (hoodline.com) The SEC order and the DTC no‑action letter preserve T+1 settlement, existing investor rights, and reporting obligations while enabling a voluntary, three‑year DTC pilot expected to begin in the second half of 2026 and determine any wider operational roll‑out. (sec.gov)
