Nasdaq has submitted a proposed rule change to the U.S. Securities and Exchange Commission (SEC) seeking approval to allow trading of tokenized stocks and exchange-traded funds (ETFs). If approved, investors could begin trading these digital assets as early as the third quarter of 2026.
Tokenized stocks are digital representations of traditional shares or ETFs recorded on a blockchain, enabling fractional ownership and potentially greater accessibility for smaller investors. Nasdaq emphasized that these tokenized products would be treated identically to regular stocks, with settlement processed through the Depository Trust Company (DTC), the standard clearinghouse for U.S. securities. This integration aims to ensure stability and familiarity for market participants.
The move aligns with broader Wall Street interest in asset tokenization, partly driven by a more receptive regulatory environment under the current administration. SEC Chairman Paul Atkins has prioritized tokenization, comparing the shift to the transition from analog to digital media and highlighting its potential to reshape securities markets.
Benefits include increased accessibility, enhanced efficiency through blockchain, and improved transparency. However, experts warn of potential risks such as regulatory complexities, cybersecurity threats, and systemic risks if not properly managed. Nasdaq's proposal follows similar initiatives by platforms like Robinhood in Europe and crypto exchanges like Bybit, Kraken, and Gemini.