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SEC Commissioner Warns: Tokenized Stocks Still Fall Under Crypto Regulations

US Securities and Exchange Commission (SEC) Commissioner Hester Peirce has issued a critical warning regarding the legal status of tokenized stocks within the crypto sector.

As interest grows in tokenized securities, Peirce emphasized that these digital assets retain their designation as securities under federal laws.

She stated, “No matter how powerful blockchain technology is, it does not have the ability to magically change the nature of the underlying asset.”

This statement arrives amid escalating efforts by leading cryptocurrency firms such as Coinbase and Kraken to launch tokenized stock products in the United States.

If approved by the SEC, these initiatives could disrupt the traditional brokerage landscape by facilitating blockchain-based stock trading.

Peirce's comments were highlighted following a Senate Banking Committee hearing that focused on existing digital asset regulations.

During this hearing, Senator Elizabeth Warren expressed concerns about the Clarity Act, a proposed bill that may allow non-crypto entities to tokenize their assets while circumventing SEC scrutiny.

The implications of these developments could significantly reshape the regulatory environment for cryptocurrencies and tokenized assets.

As the landscape evolves, industry participants must remain vigilant and informed about the legal frameworks governing their innovations.

Understanding compliance will be vital for the future of tokenized stocks as they integrate more into mainstream finance.