SEC Grants DTCC Approval To Pilot Tokenized Stocks, Bonds, And U.S. Treasuries

(MENAFN- Crypto Breaking) The U.S. Securities and Exchange Commission (SEC) has granted a subsidiary of the Depositary Trust and Clearing Company (DTCC) approval to offer tokenized real-world assets. Through this approval, DTCC now has permission to custody and record tokenized stocks, bonds, and US Treasuries on pre-approved blockchains for three years.

Tokenization at the Heart of the U.S. Financial Markets

On Thursday, the SEC marked a pivotal moment in the U.S. financial markets when it announced the issuance of a 'no-action letter' to the Depository Trust Company (DTC), a subsidiary of DTCC. With this letter, DTCC can now pilot a new securities market tokenization service for DTC-custodied assets in a controlled production environment, beginning in the second half of 2026 for up to three years.

For context, the DTCC is the central plumbing of the U.S. financial markets, the institution that makes sure trades actually settle, and ownership records stay accurate. Many liquid assets in U.S. markets reside in it, held by its custody arm, the DTC. And now, with this approval, the future of securities tokenization rests with it.

How it Works and Industry Impact

As we have mentioned on several occasions, tokenization is the process of converting real-world assets, such as stocks, bonds, and other assets, into digital tokens that can be traded on a blockchain. Under this approval, DTC gets the ability to create tokenized versions of assets it already holds in custody and record them on pre-approved blockchain networks. The tokenized assets will have the same entitlements, investor protections, and ownership rights as the ones in their traditional form.

The approval applies to a set of highly liquid assets, including the Russell 1000 index, exchange-traded funds (ETFs) tracking major indexes, US Treasury bills, corporate bonds, and notes.

Supporters of tokenization say that this move has the potential to yield transformational benefits such as bridging the gap between traditional and decentralized finance and offering 24/7 access to certain assets. Skeptics, on the other hand, say that the technology may be new, but the underlying risks in lending and borrowing remain unchanged.

All in all, we will see how this plays out in the coming days as we await the DTCC publication of a list of supported networks in the coming months.

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