- SEC plans tokenization rules under Project Crypto while keeping assets within existing laws.
- Innovation exemption will let firms test token models as agencies study privacy and compliance.
- Tokenized assets may see wider adoption as regulators review zero-knowledge tools and industry input.
SEC Chair Paul Atkins said tokenization can make markets more transparent and keep the United States at the forefront of innovation. His remarks come as the agency prepares new steps aimed at bringing blockchain technology into regulated financial systems. The SEC’s plans place tokenized assets inside existing rules while supporting controlled testing of new models.
SEC Positions Tokenization Within Market Modernization Plans
SEC Chair Paul Atkins stated that tokenization is the key element needed to modernize the country’s aging capital markets. He said the agency’s program, Project Crypto, is designed to provide clarity under current securities laws while Congress continues to review the CLARITY Act.
According to Atkins, major banks and brokers may adopt tokenized real-world assets within the next decade. He noted that the SEC is working with the Commodity Futures Trading Commission to support early adoption across financial institutions. He added that tokenized securities would remain securities, and they would continue to operate under federal law.
Atkins also stated that digital collectibles, commodities, and tools do not fall under securities rules. The SEC plans to introduce an “innovation exemption” next month that will allow companies to test new token models under defined limits. He said this framework will allow companies and retail users to explore blockchain systems while remaining within regulated boundaries.
Privacy Features and Expectations for Wider Adoption
The SEC recently updated its schedule for an upcoming roundtable to include privacy-focused tokenization projects. According to the agency’s agenda, Zcash founder Zooko Wilcox will provide input on how zero-knowledge proofs could support compliance and data protection. Commissioner Hester Peirce will lead the session as head of the Crypto Task Force.
Privacy tools are being reviewed as part of the tokenization framework because they can support compliance while protecting sensitive information. Market observers note that zero-knowledge technology is being studied for possible use in future tokenized securities programs. The SEC said the review aims to address data protection questions as blockchain infrastructure becomes part of the securities system.
Analysts noted that broader adoption of tokenized assets in the United States may influence international regulators. They also mentioned that networks supporting privacy-centric smart contracts, such as Ethereum, may see increased activity. Researchers added that cooperation between traditional finance and the web3 sector may support steady development within future tokenized markets.
