US Financial Markets Set to Transition On-Chain Following DTCC Tokenization Approval

SEC's Innovation Exemption: The SEC chair, Paul Atkins, is advocating for an "innovation exemption" to facilitate the transition of U.S. financial markets to on-chain systems, aiming to reduce regulatory burdens for market builders.

DTCC's Tokenization Pilot: The SEC issued a "no action" letter allowing the Depository Trust and Clearing Corporation (DTCC) to launch a tokenization service for various assets, which is seen as a significant step towards on-chain capital markets.

Benefits of On-Chain Markets: Atkins highlighted that on-chain markets would enhance predictability, transparency, and efficiency for investors, enabling features like 24/7 trading and faster transaction finality.

Industry Response and Funding: Analysts have praised the SEC's move, noting the rapid shift towards tokenization in financial markets, while projects like Real Finance are securing funding to develop infrastructure for real-world asset tokenization.