SEC Commissioner: Welcome to Explore Regulatory Engagement on Tokenization

BlockBeats News, March 17th. According to The Block, U.S. Securities and Exchange Commission (SEC) Commissioner Hester Peirce said in an interview with CNBC on Monday that the regulatory agency welcomes asset management companies exploring tokenized financial instruments and new ETF structures to proactively engage with regulators.

Peirce said: "We genuinely want you to come in and talk to us about what you want to do. We want to work with you to explore the possibilities of allowing the market to test your products." She noted that as attitudes toward blockchain technology have shifted, an increasing number of companies have voluntarily proposed tokenization schemes to the SEC in recent years: "People have come to us saying they really think there's potential here for tokenization."

Regarding leveraged ETFs, Peirce stated that the SEC is not responsible for judging the merits of the product itself but must ensure that the product complies with statutory leverage limits and disclosure requirements. If an issuer can demonstrate that the product structure complies with securities laws, they may propose a scheme that exceeds the usual thresholds. On the tokenization front, Peirce revealed that SEC staff are exploring a "limited-range" innovation exemption that aims to allow for restricted trading of some tokenized securities within the existing regulatory framework, rather than establishing a broad securities law exemption.