With companies like BlackRock driving significant growth in the tokenization space, American stock exchange Nasdaq is poised to take advantage of this development by working with US authorities to make it easier for tokenized securities to be traded.
In a recent LinkedIn post, Nasdaq President Tal Cohen emphasized the potential of integrating tokenization and blockchain technology with traditional market infrastructure.
He pointed out that this fusion could provide substantial advantages to issuers, investors, and the broader economy by reducing friction in transactions, speeding up settlement times, automating processes, and enhancing capital and collateral management efficiencies.
As part of this effort, Nasdaq has submitted a filing to the US Securities and Exchange Commission (SEC) to enable the trading of tokenized securities on its platform.
In his remarks, Cohen acknowledged the potential of blockchain technology to introduce new post-trade processes, modernize proxy voting, and create programmable methods for managing corporate actions.
The rise of decentralized finance (DeFi) has offered valuable insights into how core financial services—such as lending, trading, and clearing—can operate differently to deliver value.
However, Cohen also highlighted the risks associated with rapid advancements. Cohen stressed the importance of embedding governance and investor protection from the outset to ensure that the benefits of innovation can be fully realized.
Nasdaq’s recent filing is seen as a pivotal step in its journey to incorporate digital asset technology into the US equities markets responsibly. The proposal aims to integrate new capabilities into the existing financial system, further enhancing the efficiency and trustworthiness of these markets.
If the SEC approves Nasdaq’s proposal, it would represent the first instance of tokenized securities being traded on a major US stock exchange, marking a significant milestone in the integration of blockchain-based settlement into the national market system.
Notably, Coinbase, the largest US cryptocurrency exchange, has also sought the regulatory agency’s approval for offering “tokenized equities” to its users, while major banks like Bank of America and Citi have expressed interest in exploring tokenized assets.
Once Nasdaq’s proposal is in place and the necessary infrastructure from the central clearing agency is operational, investors could potentially buy shares on Nasdaq that settle in token form, all without altering the current processes for order routing, pricing, surveillance, or reporting.
Nasdaq anticipates that US investors may witness the first token-settled trades by the end of the third quarter of 2026, contingent upon the readiness of the Depository Trust Company’s infrastructure.
Featured image from DALL-E, chart from TradingView.com
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