On Sept. 2, the U.S. Securities and Exchange Commission (SEC) put forward an update to its registration transfer agent rules, The Block reported. Those rules have gone largely untouched since the late 1970s. Old stuff. The rewrite is meant to catch up with electronic communications and blockchain technology as they are used in securities issuance and share transfer.
The SEC chair said the proposal would "simplify and modernize" the rules. Transfer agents keep securities ownership records, process corporate actions like mergers and dividend distributions, and sit at the center of clearing and settlement.
The SEC said transfer agents are more often dealing with newer tools, including tokenized securities and artificial intelligence. Some market participants are testing blockchain-based systems for securities ownership records. But transfer agents handling tokenized securities and smart contracts still have to deal with risks tied to blockchain data integrity, the security of tokenized securities, and the operational models of distributed ledgers.
Injective recently became a registered transfer agent with the SEC, joining companies such as Securitize and tZERO that are already registered. And the public comment period for the proposed rule change lasts 60 days.