SEC Proposes Updates to Transfer Agent Rules, Incorporating On-Chain Equity Registration and Settlement

Odaily reports that the U.S. Securities and Exchange Commission (SEC) proposed on September 1 its first major revision to transfer agent rules since the 1970s, aiming to incorporate blockchain technology into the securities registration and settlement system. The proposal states that transfer agents may use distributed ledger technology to record and transfer securities, while also needing to avoid ownership data fragmentation caused by the coexistence of token wrapping, special purpose vehicles, broker internal ledgers, and off-chain databases. Institutions such as Fairmint advocate for treating on-chain cap tables as the official ledger required under Section 17A of the Securities Exchange Act.