The U.S. Securities and Exchange Commission (SEC) has granted a landmark five-year Innovation Exemption that allows qualifying platforms to trade tokenized U.S. stocks on-chain without registering as traditional exchanges, marking a significant regulatory milestone for real world asset (RWA) tokenization. The exemption, issued on September 17 by SEC Chairman Paul Atkins, came just two days after the Senate blocked the CLARITY Act and creates a temporary regulatory lane for what the SEC calls Tokenized Securities Venues (TSVs).
Under the new framework, qualifying TSVs can facilitate limited secondary trading of tokenized National Market System stocks through permissioned automated market makers and liquidity pools on public, permissionless blockchains. The underlying tokens must carry conventional shareholder rights, including dividends and voting power. Tokenization must be handled either by the issuing company directly or by an unaffiliated third party the issuer has not objected to, giving companies a 30-day window to veto unauthorized tokenization of their shares.
The regulatory breakthrough coincides with explosive growth in on-chain RWA assets. According to Binance Research's RWA Activation Era report published September 18 using DeFiLlama data, on-chain real world assets reached $34.18 billion as of September 15, up 85.2% since the start of 2026. Bonds and money market funds remain the largest category at $18.29 billion, while tokenized equities grew the fastest of any segment, up 390.4% year-to-date and now representing 13.0% of the tracked market. Notably, only an estimated 12% of tracked tokenized capital is actively deployed in on-chain financial applications like lending, trading, or collateral use cases.
Institutional infrastructure is moving in parallel. DTCC's Fund/SERV platform, which processes more than 85% of U.S. mutual fund transaction activity, welcomed its first tokenization member on September 16 when Ondo Finance subsidiary Oasis Pro Markets joined the network. DTCC had already completed production transactions using DTC-tokenized assets in mid-July, testing tokenized securities across Treasury repo, equity delivery versus payment, securities lending, and collateral pledge workflows. A broader DTC tokenization service is scheduled to launch in October 2026.
Taylor Lindman, chief counsel of the SEC Crypto Task Force, said during a Crypto In America interview with SEC Commissioner Hester Peirce that he expects the first tokenized stocks venue notices to be filed next quarter. Peirce said she does not expect widespread issuer objections to prevent the model from developing, noting that companies value liquidity. Robinhood CEO Vlad Tenev publicly welcomed the exemption, calling it a step toward instant settlement, 24/7 trading, and default fractional ownership for tokenized securities. SEC Chair Paul Atkins emphasized that durable rulemaking must follow the interim measure, describing it as a way to observe market development while upholding investor protections and market integrity standards.
On DeFi lending, Aave's Horizon product—launched in August 2025 for qualified borrowers seeking stablecoin liquidity against tokenized assets—had surpassed $440 million in deposits by February 2026, with a dedicated RWA credit hub planned on Avalanche. Solana has emerged as a particular beneficiary of the tokenized equity trend, hosting more tokenized equities than any other blockchain network.
