The U.S. Securities and Exchange Commission (SEC) has approved a landmark rule change allowing Nasdaq to trade securities in tokenized form, marking a significant milestone in the integration of traditional finance and blockchain technology. The decision, announced on Wednesday, March 18, 2026, follows Nasdaq's initial proposal submission in September 2025, which underwent evaluations and two separate amendment processes before receiving final regulatory approval.
The new framework enables certain assets to be represented and traded on the blockchain under the Depository Trust Company's (DTC) tokenization pilot program. Initially, the program will be limited to specific assets: stocks included in the Russell 1000 index, as well as Exchange-Traded Funds (ETFs) tracking major indices such as the S&P 500 and Nasdaq-100. Nasdaq will regularly publish the list of eligible assets through investor announcements.
Tokenized shares will trade on the same Nasdaq order book, at the same price, and alongside their traditional counterparts. They will carry identical rights, use the same ticker and CUSIP identification numbers, and adhere to existing market rules. The SEC stated that the approved structure meets investor protection standards, with surveillance, data reporting, and settlement timelines remaining intact.
Market participants wishing to trade using tokens must select a special "tokenization preference" option when placing orders. This preference determines whether the transaction will be settled in tokenized or traditional form and may include additional details such as blockchain selection and digital wallet address. Post-transaction, Nasdaq will share these preferences with the DTC, enabling settlement to be carried out in token format.
The move capitalizes on the fast-growing trend of tokenizing traditional assets like stocks, bonds, and funds, which promises near-instant, around-the-clock trading. This development is part of a broader push by major U.S. exchanges into the digital asset space. Nasdaq recently revealed it is developing a framework to allow publicly listed companies to issue blockchain-based versions of their shares and has partnered with crypto exchange Kraken for global distribution. Simultaneously, Intercontinental Exchange (ICE), owner of the New York Stock Exchange (NYSE), has invested in crypto exchange OKX with plans to launch new tokenized stocks and crypto futures.
