SEC Commissioner Hester Peirce Says Innovation Exemption May Be Limited to Onchain Equity Products

SEC Commissioner Hester Peirce previously said the SEC’s proposed innovation exemption for tokenized stocks should be viewed as a narrow framework for onchain equity products, not a broad opening for unrestricted tokenized stock trading. New reporting says the SEC has now delayed release of the exemption, which under Chair Paul Atkins had reportedly been expected as soon as this week. According to Bloomberg, the framework would create a regulatory pathway for digital tokens linked to publicly traded U.S. stocks to trade around the clock on decentralized crypto platforms, potentially including third-party-issued tokens created without consent from the underlying public companies. The report says such tokens may not automatically include voting or dividend rights, though the SEC is considering whether platforms would need to provide those rights or face delisting. The delay follows feedback from stock-exchange officials and other market participants, including prior objections from the World Federation of Exchanges that the plan could weaken investor protections and distort competition by giving crypto venues regulatory advantages unavailable to traditional exchanges. The debate also contrasts with Nasdaq’s SEC-approved March 2026 tokenized securities model, which keeps trading on-exchange and preserves full shareholder rights through DTCC blockchain infrastructure.