SEC Commissioner Hester Peirce stated that the market should determine successful tokenization approaches while adhering to existing laws.
Tokenization Rules and Existing Laws
Hester Peirce confirmed that blockchain does not change the legal classification of assets. A tokenized security is considered a security under U.S. law, and compliance with federal regulations is mandated. Issuers and distributors must provide transparent disclosure regarding their products.
Innovation and Investor Protection
Peirce, who leads the SEC's Crypto Task Force, stated that the commission will use its powers to regulate tokenization. She advocates for the use of regulatory sandboxes and initiatives to foster innovation while ensuring investor safety. Stressing the importance of compliance and transparency, Peirce noted the need for cooperation with companies exploring tokenization.
Growing Industry Interest in Tokenization
Interest in tokenization is increasing as the U.S. considers rules for stablecoins and broader blockchain adoption. Peirce noted that tokenization could lead to faster settlement times and broader market access, while innovation must remain within the boundaries of existing laws.
Hester Peirce's statements highlight the SEC's focus on legal compliance in the development of innovative solutions in asset tokenization.
