On-chain secondary trading pathway opens, SEC issues 5-year innovation exemption for tokenized stocks

Odaily reports: Galaxy's head of research posted on X that the U.S. Securities and Exchange Commission has issued an "innovation exemption" establishing a pathway for on-chain secondary trading of tokenized stocks. The exemption will be in effect from September 17, 2026, to September 17, 2031, and applies to specific tokenized securities trading venues that offer permissioned automated market makers and liquidity pools; trading venues must be deployed on public, permissionless blockchains, but trading is limited to verified or authorized participants.

Eligible tokens must correspond to actual U.S. National Market System stocks and confer the same shareholder rights as traditional stocks; the exemption does not cover primary issuance, synthetic exposure, or products that do not carry legal or beneficial rights to the underlying stock. Galaxy stated that it is studying the next steps to enable on-chain secondary trading of GLXY.