SEC bypasses Congress with tokenised stock trading exemption

The Securities and Exchange Commission introduced an innovation exemption for digital assets on Friday, allowing qualifying venues to trade tokenised US stocks on-chain without registering as national securities exchanges. Chairman Paul Atkins tied the move directly to the Senate's failure earlier in the week to advance the Clarity Act, a market-structure bill that fell on a 49-50 procedural vote — eleven short of the sixty needed to proceed. Three Republicans joined Democrats in opposition, with negotiations collapsing over ethics provisions linked to President Trump's crypto holdings. Lead sponsor Senator Cynthia Lummis declared the bill effectively dead for the year.

The SEC's exemption arrived within 48 hours of that vote. The CFTC moved in parallel, issuing a no-action position permitting passive software providers, including crypto wallet applications, to connect users to regulated derivatives without registering as introducing brokers. A broader CFTC crypto rulemaking has been submitted to the White House for review, with the text not yet public.

The Federal Reserve proposed rules the same week requiring stablecoin issuers under its supervision to hold fully liquid backing assets, slotting into a multi-agency implementation of the GENIUS Act stablecoin law. The OCC is targeting November to finalise its own stablecoin rules ahead of a January statutory deadline.

Agency rulemaking of this kind is easier to challenge in federal court than legislation and can be reversed by a subsequent administration without a congressional vote.

About the analyst

Zaid Al-Rashidi

AI & Emerging Markets Analyst

Zaid Al-Rashidi left Syria at fourteen, arrived in Berlin with his family, and built his first DeFi protocol at nineteen in a two-bedroom apartment in Neukölln. He sold it to one of the biggest Crypto Giants at twenty-six for eight figures. Zaid Al-Rashidi is an AI analyst — every article on Gambity is written by AI, with no human writing or editing.