SEC Chair Paul Atkins said the agency’s long-awaited tokenization innovation exemption could be released within the next few weeks. The measure is designed as a regulatory sandbox that would let firms test certain on-chain securities activities without going through the full SEC registration framework from the outset.
In comments to Crypto America, Atkins described the timeline as “soon, soon, soon. I think here in the next few weeks.” The delay is tied to federal review. The proposal is currently with the Office of Information and Regulatory Affairs, a unit within the Office of Management and Budget that reviews agency actions before publication. After that step, the SEC is expected to open a public comment process and then shape the final rules.
A controlled sandbox, not a rewrite of securities law
SEC Commissioner Hester Peirce, who is leading work on the exemption’s design, has already cautioned that firms should not treat the plan as a broad overhaul of securities regulation. Based on the current outline, the sandbox would allow limited trading of some tokenized securities on blockchain rails under controlled conditions.
That distinction matters. Supporters see the exemption as a practical way to let regulated experimentation move forward, while critics worry that carving out special treatment for blockchain-based securities markets could weaken core investor protections.
House hearing showed broad agreement on arrival, not on rules
On the same day Atkins made those remarks, the House Financial Services Committee held a hearing titled “Tokenization and the Future of Securities: Modernizing Our Capital Markets.” Lawmakers and witnesses largely agreed that tokenized securities are coming. Consensus ended there.
Rep. Brad Sherman warned about a possible “two-tiered market” in which tokenized securities on blockchain platforms could be exempt from key securities rules. Rep. Maxine Waters linked the debate to lessons from 2008 and questioned whether the technology primarily benefits investors or intermediaries.
Rep. Warren Davidson blamed former SEC Chair Gary Gensler directly, saying he “wanted to prevent any kind of real progress on the Commission.” At the hearing, Blockchain Association CEO Summer Mersinger argued that tokenization could strengthen U.S. capital markets, but only if the regulatory framework is built around how blockchain systems actually operate rather than around legacy market structure.
Infrastructure is moving before the rulebook is finished
Market operators are already building. NYSE has partnered with Securitize on a tokenized securities platform. Last week, the SEC approved Nasdaq’s tokenized securities pilot, and the first token-settled trades are expected by the end of Q3 2026.
That leaves regulators trying to catch up with infrastructure already in motion. If the SEC releases the exemption text in the coming weeks and moves into public consultation, the U.S. will be closer to a formal testing framework for tokenized securities, even as the scope of that framework remains under debate in Washington.