The U.S. Securities and Exchange Commission (SEC) approved a Nasdaq rule change proposal on March 18, 2026, paving the way for the trading of listed company shares in tokenized form within the existing market structure. This approval (SR-NASDAQ-2025-072) signifies the SEC's formal endorsement of tokenizing securities within traditional financial rails.
Under the approved framework, tokenized shares must be fully fungible with their traditional counterparts, possessing identical CUSIP identifiers and enjoying the same substantive rights and privileges as non-tokenized shares. Crucially, tokenized securities will trade on the same order book as traditional stocks. This means that the execution priority of orders will remain consistent, unaffected by the settlement type, as the order matching mechanism will be identical regardless of whether settlement is chosen in tokenized form.
The significance of this approval lies in its preservation of the existing system rather than the creation of entirely new possibilities. Nasdaq's matching logic remains unchanged, and the entire model operates within the framework of the Securities Exchange Act, without establishing a separate crypto-native market structure. This indicates a regulatory preference for integrating innovative technologies within existing legal and technological infrastructures.
However, it is important to clarify that this approval does not encompass all post-trade processes. Under the approved model, post-trade clearing and settlement rely entirely on the existing processes of the Depository Trust Company (DTC). Nasdaq's core matching engine remains unmodified, with the tokenized settlement layer positioned downstream from trade execution. Therefore, claims circulating in crypto media about widespread retail 24/7 trading of tokenized Nasdaq stocks are not substantiated by the SEC's approval order alone. This approval is a rule change, not a product launch, and the actual timeline for implementation will depend on DTC readiness, limitations of pilot programs, and the willingness of issuers to adopt.
Currently, the confirmed regulatory milestone is clear and limited: Nasdaq has received SEC permission to allow its listed securities to trade in tokenized form within the confines of the existing market infrastructure. The future implementation timeline and the scope of issuer participation will be key variables to monitor closely.