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‘Tokenized Securities Are Nonetheless Securities’

US Securities and Change Fee (SEC) member Hester Peirce issued a blanket warning for firms contemplating distributing and buying and selling tokenized securities.

In a Wednesday assertion, Peirce referred to as on firms to debate their potential tokenized choices with SEC officers amid “new entrants and plenty of conventional corporations […] embracing onchain merchandise.”

Although the SEC commissioner, who additionally heads the company’s crypto activity drive, didn’t explicitly point out buying and selling platform Robinhood, her discover got here roughly two weeks after the corporate launched a tokenization-focused layer-2 blockchain.

“As highly effective as blockchain know-how is, it doesn’t have magical talents to remodel the character of the underlying asset,” mentioned Peirce. “Tokenized securities are nonetheless securities. Accordingly, market contributors should take into account—and cling to—the federal securities legal guidelines when transacting in these devices.”