The US Securities and Exchange Commission established a conditional framework allowing registered tokenized stocks to trade on public blockchains using automated market makers. This five year "innovation exemption" applies to National Market System securities that provide holders with identical voting and dividend rights to traditional shares. Trading is limited to permissioned venues where participants must complete identity verification, and volume cannot exceed 0.25% of a stock's average daily trading amount.

Tokenization-related crypto assets surged up to 50% following the announcement, with $HYPE reaching a record $96. The framework favors existing infrastructure like Coinbase's Base network, where tokenized stock volume recently crossed $1 billion, and Circle's USDC for settlement. However, the SEC noted that these venues will not have the best execution protections required by Regulation NMS, a gap that analysts suggest may discourage professional market makers.