The U.S. Securities and Exchange Commission (SEC) is reportedly formulating a plan that could allow stocks to be traded on blockchain technology, similar to cryptocurrencies. This initiative marks a potentially significant step toward integrating digital asset technology into the traditional financial system.

The proposal, still in its early stages, would enable investors to buy and sell stock tokens, which are digital representations of shares in publicly traded companies, on approved crypto platforms. According to The Information, the SEC is in discussions with industry representatives about the plan. Companies like Coinbase and Robinhood are reportedly advocating for quick regulatory approval to permit stock trading on blockchain platforms.

SEC Chair Paul Atkins has described tokenization as an "innovation" that the agency should seek to advance, not restrict. He noted that tokenized assets could improve access to financial markets and reduce costs.

This initiative is considered a key element of the Trump administration's crypto-focused regulatory agenda. It could potentially allow investors to purchase tokens on crypto exchanges that represent shares of companies like Tesla or Nvidia. Nasdaq has also requested SEC approval for a rule change that would allow it to list tokenized securities on its exchange.

However, the SEC's willingness to embrace blockchain-based equities faces resistance from traditional finance companies. Citadel Securities cautioned regulators to ensure that tokenization delivers genuine market benefits rather than exploiting regulatory gaps. In a July note to the agency's Crypto Task Force, Citadel wrote that "Tokenized securities must achieve success by delivering real innovation and efficiency to market participants, rather than through self-serving regulatory arbitrage".