”Nasdaq Seeks SEC Approval for Tokenized Stock Trading Rule Change”

Nasdaq has filed a rule change request with the U.S. Securities and Exchange Commission to allow regulated exchanges to list and trade tokenized stocks — blockchain-based digital representations of real-world shares that can be fractionalized and traded more flexibly.

The move aims to speed settlement, increase liquidity, and broaden access by enabling 24/7 trading and smaller investment sizes, while relying on regulatory oversight to protect investors and preserve market integrity.

If the SEC approves the change, other exchanges could follow, creating a new bridge between traditional finance and digital assets and potentially reshaping how retail and institutional investors access equity markets.

Episode Transcript

Intro (00:00):
Nasdaq has formally asked the Securities and Exchange Commission to approve a rule change that would let regulated U.

(00:07):
S.
exchanges trade tokenized stocks.
It’s a move that may sound technical,but it could change how investors buy,
sell and own shares—if the SEC signs off.
Tokenized stocks are simply digital tokens on a blockchain that represent ownership of real-world equity.
Because those tokens can be issued in fractional amounts,

(00:28):
they make it practical for investors to own much smaller slices of expensive shares.
The blockchain layer also creates a single,visible record of ownership and transfers,
which can streamline back-office processes.
The potential benefits are straightforward.
Tokenization can boost liquidity by opening ownership to a wider set of investors,

(00:49):
speed up settlement from days to near-instant,and enable trading around the clock.
Removing or automating traditional intermediaries could cut costs and operational friction,
making markets more accessible,especially for retail investors who want fractional exposure.
Nasdaq’s proposal signals a strategic embrace of this technology.

(01:11):
By seeking a regulated pathway for tokenized stocks,
Nasdaq is aiming to bring blockchain-driven efficiencies into the mainstream market structure while keeping trading inside the established exchange and regulatory framework.
That approach could make tokenized instruments more credible to institutional participants and the broader investing public.

(01:32):
Regulation will be central to whether this idea succeeds.
Clear rules are needed to protect investors and preserve market integrity—covering custody and safekeeping of underlying assets,
how tokens map to legal ownership,surveillance and anti-market-manipulation measures,
and the role of broker-dealers and clearinghouses.

(01:53):
Nasdaq’s filing is as much about setting those guardrails as it is about enabling new technology.
If the SEC approves, the ripple effects could be large.
Other exchanges might follow,and tokenized stocks could become a new,
hybrid asset class that blurs the line between traditional securities and digital assets.
That could democratize access to high-value stocks,

(02:15):
spawn new product types,and accelerate innovation in trading,
settlement and custody services.
Adoption won’t be frictionless.
Challenges include designing compliant custody solutions,
managing cybersecurity threats,ensuring interoperability across platforms,
and addressing potential volatility or liquidity mismatches during early stages.

(02:38):
There will also be a need for investor education so people understand what token ownership means in practice and what protections exist.
Looking ahead, Nasdaq’s filing is an important test case.
Approval would mark a significant step toward integrating blockchain capabilities into regulated markets;
rejection or heavy restrictions would slow broader adoption and force participants to rethink technical and legal approaches.

Either way,the conversation has shifted (03:04):
tokenization is no longer purely experimental—it’s now being argued for inside the halls of established market infrastructure.

Closing (03:15):
The SEC’s decision will tell us whether tokenized stocks move from promising concept to mainstream market feature.
For investors,exchanges and technologists alike,the next chapter will be about balancing innovation with the rules and safeguards that keep markets fair and resilient.