SEC Issues "Innovation Exemption" to Facilitate On-Chain Trading of Tokenized NMS Stocks

According to the SEC's official website, the U.S. Securities and Exchange Commission (SEC) issued an "Innovation Exemption" order on September 17, 2026, granting a temporary, conditional exemption to Tokenized Securities Venues (TSVs) that permits them to trade tokenized National Market System (NMS) stocks through licensed automated market maker (AMM) liquidity pools for a five-year period. SEC Chair Paul S. Atkins stated that this initiative aims to propel U.S. capital markets into the digital age. Key conditions include caps on trading symbols and trading volume, guarantees that tokenized equities confer equivalent rights to their holders as traditional stocks, requirements that smart contracts be deployed on public, permissionless distributed ledgers and remain auditable, and stipulations that trading halts must be synchronized with the underlying NMS stocks. The SEC has also concurrently solicited public comments on the exemption's specific rules.