Robinhood shares climbed 5% after the SEC cleared a path for tokenized U.S. stock trading, setting the stage for a potential domestic launch by 2027.
SEC Innovation Exemption enables tokenized U.S. stock trading, a direct growth opportunity for Robinhood's equities business.
The SEC has issued an Innovation Exemption allowing for the trading of tokenized U.S. stocks without traditional exchange registration for five years. This regulatory shift provides a clear path for Robinhood Markets to bring its tokenized equity products to the U.S. market, potentially enabling 24/7 trading and new collateral utility for its existing user base.
It permits qualifying venues to trade tokenized versions of U.S. stocks for five years without registering as traditional stock exchanges, provided the tokens grant holders full shareholder rights.
Current international tokens are structured as debt securities or derivative contracts that lack voting rights and ownership of underlying shares, which does not meet the SEC's new criteria for tokenized securities.