SEC Issues License for "On-Chain US Stocks": Listed Companies No Longer Have Veto Power

Original Author: TechFlow

According to a report from Bloomberg Law on Monday, the U.S. SEC could release the "Innovation Exemption" framework for tokenized stocks as early as this week.

The real bombshell lies in one of the draft opinions: allowing the trading of tokens that have not received consent from the listed companies themselves.

To put it simply: Tesla, Apple, Nvidia – as long as they are listed on the U.S. stock market, their stocks could potentially be issued and traded on some blockchain in the form of "tokenized TSLA" without the companies being informed or consulted. Their legal departments can, of course, issue disclaimers, but what happens after that? The trading will likely go ahead as usual.

Rewind 11 Months

To grasp the significance of this news, we need to go back to the drama in July 2025.

Robinhood announced "Stock Tokens" for EU users in Cannes, enabling 24/7 on-chain trading for over 200 U.S. listed companies. Vlad Tenev was speaking confidently on stage until he dropped the real bombshell: a giveaway of tokens for two unlisted companies, OpenAI and SpaceX, worth a combined $1.5 million.

The next day, OpenAI slammed Robinhood on X, stating: "These 'OpenAI tokens' do not represent equity in OpenAI. We have not partnered, participated, or endorsed this. Any transfer of OpenAI equity requires our approval – which we have not granted. Please exercise caution."

Robinhood's explanation was awkward: these tokens are pegged to an SPV that holds OpenAI stock, essentially being a "derivative." The Central Bank of Lithuania, Robinhood's primary regulator in the EU, subsequently sent a letter demanding an explanation of the structure's legality.

The core question from that controversy was this: Can a third party create derivatives based on a company's equity when the company itself explicitly objects?

Public opinion in July last year mostly saw Robinhood's move as distasteful. Now, 11 months later, the SEC's answer might be: Yes, and we'll give you a license to do it.

The SEC's Logic Chain: Premeditated

Paul Atkins has been SEC Chair for a year, and every move he made seems to lead to this moment.

On April 21, Atkins made it clear during a speech at the Economic Club of Washington: the SEC is set to introduce the "Innovation Exemption," a 12-to-36-month regulatory sandbox allowing tokenized securities to be traded on-chain without full registration, subject to trading volume caps, whitelists, and periodic reporting.

A more crucial clue was a legal memo submitted to the SEC's Crypto Task Force on January 22, which explicitly outlined three models for tokenized U.S. stocks:

• Direct Issuance Model: The issuer records equity directly on-chain, requiring the issuer's consent.
• Custodial Receipt Model: A third-party custodian freezes existing shares and issues corresponding digital receipts on-chain. This doesn't require the issuer's consent because the underlying securities still exist in their original form.
• Synthetic Model: Uses derivative contracts to track the stock price. This doesn't require the issuer's consent, as the token and the underlying security are independent.

The SEC's current inclination essentially acknowledges the legality of the latter two models. The "good student" approach of working with issuers, as practiced by Galaxy and Superstate, will now compete on the same playing field as the "act first, ask later" rough-and-tumble approach of Robinhood.

Regulatory arbitrageurs will love this outcome. CFOs of listed companies, however, might need to hold emergency meetings.

Who's Happy, Who's Not?

Those who will be smiling:

• On-chain brokerages and DEXs. Robinhood no longer needs to justify itself for the OpenAI PR crisis last year. The strategy that got it criticized is about to become compliant.
• DeFi infrastructure. If tokenized U.S. stocks can truly run on AMMs, it means moving a portion of the entire Nasdaq's liquidity next to Uniswap and Curve.
• Protocols that invested early in the RWA track. Projects like Ondo, Backed, and Securitize have been waiting for this document.
• Global retail investors. The trading hours for the U.S. market would change from 6.5 hours a day to 24/7.

Those who will be frowning:

• Listed companies. This is the most delicate group. Tokenization of a company's stock creates a "shadow market" the company cannot control. If a price discrepancy arises between the on-chain token and the actual stock, or if on-chain trading leads to complex issues regarding governance rights or shareholder activism, these problems will eventually land on the desks of IR and legal departments. And they have no veto power over it.
• Traditional brokerages and clearinghouses. The implicit logic of tokenization is that "DTCC can be bypassed."
• Conservatives within the SEC. Hester Peirce made the widely quoted statement last July: "Tokenized securities are still securities." She supports tokenization but opposes using it to circumvent substantive investor protection. This "no issuer consent required" stance will be a flashpoint for internal SEC debate.

Key Questions Worth Asking

The greatest appeal of tokenized stocks has always been "what you can do once on-chain": collateralization, combining, frictionless integration with other assets in stablecoin pools, and repeated re-packaging in DeFi.

However, if the SEC's exemption framework strictly mandates whitelist trading, volume caps, and KYC thresholds, the DeFi composability aspect would be significantly hampered. An "on-chain U.S. stock dancing in chains" and a truly DeFi-native U.S. stock that is 24/7, globally accessible, and composable are two entirely different things.

Before the official document is released, several details will determine the final form of this matter:

• Will the whitelist be limited to U.S. accredited investors, or will it be open to retail?
• Will there be cross-border regulatory coordination? Could there be conflicts between tokenized stocks under the EU's MiCA and those under the U.S. Innovation Exemption?
• If a listed company files a lawsuit, will the SEC's exemption provide legal protection for third-party issuers?
• After the 12-36 month sandbox period, will it be formalized or shut down?

In the past, the core power to decide where, when, and how a company's stock is traded rested with the issuer and the exchange. The SEC's move essentially partially takes away that power from issuers, redefining "who decides how a stock can be traded."

Last year, Robinhood was ridiculed in Europe for being ahead of the rules. Now the SEC has changed the rules.

This is the most significant financial infrastructure change to watch for in 2026. New mainnet launches and DeFi protocol TVL records pale in comparison to this: the world's largest asset class by market cap is beginning its formal migration on-chain, with U.S. stocks themselves as the protagonists. And the key to this migration is no longer held entirely by those being migrated.

As for whether tokenized stocks are a good business in itself, frankly, after five years of storytelling, actual liquidity remains quite thin. But with the SEC removing the final legal barrier, it's time to look at this with fresh eyes.

After all, the trading paradigm that Nasdaq took 50 years to build might be rewritten on-chain within the next three years.

Worth watching.