Senior representatives from major Wall Street firms and industry groups have pushed regulators to apply existing securities laws to tokenized assets, warning against special exemptions for blockchain based trading. Executives from leading financial institutions met with the Securities and Exchange Commission’s Crypto Task Force to argue that tokenization changes how securities are issued and traded, but not their underlying economic substance. According to the meeting record, participants stressed that allowing tokenized equities or other instruments to operate under lighter standards could weaken investor protections and disrupt established market structure rules. They urged the SEC to pursue formal rulemaking rather than relying on informal guidance or broad exemptive relief. The group emphasized the need for a level regulatory playing field, arguing that securities should not face different compliance requirements solely because they are transacted on blockchain infrastructure rather than traditional market rails.
The discussion reflects growing institutional concern that rapid experimentation in tokenized markets could outpace regulatory safeguards. Participants framed tokenized securities, whether issued natively onchain or through entitlement based structures, as economic equivalents of traditional instruments already governed by federal law. From this perspective, exemptions risk creating parallel markets with uneven standards for transparency, access, and oversight. While decentralized finance was mentioned during the meeting, it was not a central focus and was discussed primarily in relation to how exchange and broker dealer rules might apply when tokenized securities are traded through decentralized or hybrid systems. Broader DeFi activities such as lending or governance were not addressed. The tone of the meeting suggested alignment between regulators and large financial institutions around the idea that innovation should proceed within existing investor protection frameworks rather than outside them.
The timing of the meeting underscores a wider policy debate over how tokenization fits into U.S. market structure. It followed recent public exchanges between traditional financial firms and crypto advocates over whether decentralized protocols handling tokenized assets require stricter oversight. At the same time, regulators are examining how emerging models like round the clock trading could reshape equity markets. Recent remarks from senior SEC officials have pointed to growing interest in extended trading hours, particularly as digital asset markets already operate continuously. Together, these discussions signal that regulators and incumbents are increasingly focused on modernizing market infrastructure while preserving core regulatory principles. Rather than creating a separate regime for tokenized securities, the prevailing view from Wall Street appears to favor integrating blockchain based trading into the existing regulatory architecture.
