Coinbase, the top US-based crypto exchange by volume, is seeking approval from the U.S. Securities and Exchange Commission (SEC) for tokenized equities offerings. This move could potentially revolutionize stock trading by digitizing company shares into blockchain-based tokens.
Tokenized equities function similarly to other digital assets, representing securities in a digital format. The advantages of tokenized equities include 24/7 trading, faster transaction times, and lower trading costs. While this innovative approach is not yet available for trading in the US, exchanges like Kraken are also exploring this sector.
According to a recent Reuters report, Coinbase is currently in discussions with the SEC to obtain either a no-action letter or exemptive relief for their offering. These approvals would provide assurance to investors and platforms that the tokenized equities comply with regulatory standards.
Paul Grewal, Coinbase’s chief legal officer, has not confirmed whether an official request has been submitted to the SEC. He emphasized the importance of regulatory clarity in promoting institutional adoption of tokenized equities, stating that confidence in compliance is crucial for market participation.
If approved, Coinbase’s entry into tokenized equities trading could position the exchange as a competitor to popular trading apps like Robinhood. This strategic move could potentially reshape the traditional stock trading landscape, offering investors new opportunities and efficiencies in the market.
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This article was created in collaboration with Midjourney to provide informative content on the evolving landscape of tokenized equities. Stay tuned for more updates on this exciting development in the world of digital assets.