The U.S. Federal Reserve said banks should treat tokenized securities the same as traditional securities for regulatory capital purposes, stating in a FAQ released Thursday that the capital framework is technology neutral. In practice, that means the method used to issue or transfer an asset does not change how banks assess it under capital rules.
The Board wrote that an eligible tokenized security should be handled in the same way as the non-tokenized version of that security under the capital rule. Securities recorded or transferred on blockchain infrastructure still need to be evaluated under the same legal standards, risk profile, and regulatory treatment applied to conventional securities.
Collateral treatment stays within the current framework
The Fed also said tokenized securities can qualify as financial collateral under existing capital rules, as long as banks satisfy the same legal and risk-management standards required for traditional securities collateral. Those standards include enforceability, valuation, and operational risk controls.
The document added that the capital rule does not assign different treatment based on whether an asset is issued or transferred on a permissioned or permissionless blockchain. For banks exploring tokenized asset markets, the clarification signals that blockchain-based securities can be brought into current collateral and capital frameworks rather than placed in a separate regulatory bucket.
Fed position aligns with earlier SEC guidance
The clarification follows a January statement from the U.S. Securities and Exchange Commission. The SEC said that putting a security on a blockchain does not alter its status under U.S. securities law. Tokenized securities remain subject to the same registration, disclosure, and investor-protection requirements that apply to traditional instruments.
Read together, the Fed and SEC positions show a consistent approach from U.S. regulators. Tokenization does not create a new category of securities regulation. Blockchain may change how assets are issued, recorded, or transferred, but it does not change the capital, compliance, and disclosure rules attached to those securities.
Tokenization activity keeps drawing institutional interest
The update comes as financial firms continue to test tokenization of traditional assets such as equities and government bonds on blockchain networks. Supporters say tokenization can improve settlement speed, increase transparency, and simplify asset transfers. Critics point to operational and legal complexity that still needs to be addressed before broader adoption.
Data from RWA.xyz estimates that tokenized public equities currently account for about $1.1 billion in market value. Within the wider tokenized real-world asset market, the total stands at roughly $26 billion, with tokenized U.S. Treasury products holding the largest share.