Crypto Journalist
Anas Hassan
Crypto Journalist
Anas Hassan
Share
Nasdaq digital assets chief Matt Savarese announced the exchange has made its tokenized-stock proposal a top priority and will “move as fast as we can” with the SEC to secure approval.
The proposal would allow trading of on-chain “stock tokens,” digital representations of publicly listed shares, under existing national market system rules.
Speaking in a CNBC interview, Savarese emphasized that Nasdaq isn’t trying to upend the existing system but aims to bring tokenization into the mainstream responsibly under SEC oversight.
“We’re not creating a new exotic instrument. The stock is the stock,” he said, stressing that investors would retain full rights and title as shareholders.
The exchange filed its rule change application in September, seeking to permit listed equities and exchange-traded products to trade in tokenized form while maintaining the same investor protections and execution standards as traditional securities.
Nasdaq Frames Tokenization as Evolution, Not Revolution
The exchange’s approach centers on maintaining the current market structure while adding blockchain-based settlement options.
“The rules have existed for decades, and we don’t want to just completely rip out and upend the entire process,” Savarese explained, noting that trades would continue flowing through Nasdaq’s order book under SEC rules and national market system oversight.
Under the proposal, tokenized shares would carry the same rights as their underlying securities, including voting privileges and dividend rights.
“It’s fully fungible between the token and its traditional form,” he said, explaining that clearing firms and the Depository Trust Company would process tokenized orders alongside conventional stocks under the same ticker symbols and CUSIP identifiers.
The executive stressed that Nasdaq positions itself as “the original innovator” in market infrastructure evolution, comparing tokenization to the exchange’s earlier shift from paper-based to electronic trading.
“It’s evolutionary. It’s not really revolutionary,” he said, describing the effort as bringing the ecosystem along gradually while ensuring investor-first principles remain paramount.
Post-Trade Efficiency and Collateral Mobility Drive Near-Term Benefits
Savarese outlined a phased timeline for tokenization benefits, with near-term gains focused on back-end processing improvements.
Tokenized settlement would create process efficiencies immediately, though the exchange plans to maintain seamless integration with existing member firm systems before pursuing faster settlement speeds.
Beyond settlement, enhanced collateral mobility emerged as a critical medium-term advantage.
“Being able to take that equity, put it into a collateral pool, allow folks to be able to move that asset instantaneously can help along the lines of making sure that you have capital efficiency,” Savarese said, noting this would eliminate the need to overcollateralize positions.
Longer-term applications extend to corporate actions, proxy voting, and programmable smart contract functionality.
“You start to get the programmable nature of what blockchain is and smart contracts are intended for,” he explained.
Nasdaq’s acquisition of Calypso through its Adenza deal provides the exchange with what Savarese called “the gold standard” in collateral management software, now integrated with blockchain rails to support tokenized asset movement.
Regulatory Path Forward Remains Central Focus
The exchange has entered the public comment period following its September filing, with responses closed by mid-October.
“We’ll move as fast as we can with the SEC and make sure that we try to push this through,” Savarese said, expressing confidence that tokenization represents a priority topic for the current administration.
While declining to provide specific approval timelines given uncertainties, including recent government disruptions, the executive emphasized Nasdaq’s collaborative approach.
“We’re not looking at kind of upending the system. We want everyone to come along with us for that ride and bring tokenization more into the mainstream, but we want to do it in that responsible investor-led way,” he said.
SEC Chair Paul Atkins has directed the agency to develop clear rules on digital asset classification.
At the same time, Commissioner Hester Peirce recently affirmed the regulator’s willingness to work with tokenization firms, provided they maintain full disclosure about asset characteristics.
Nasdaq’s filing comes as global tokenized stock markets have surged past $465 million in market value, with monthly transfer volumes climbing more than 280% according to RWA.xyz data.
Despite momentum, resistance persists from traditional financial institutions.
The World Federation of Exchanges has urged regulators to tighten oversight of tokenized equities, warning that blockchain-based products may “mimic” traditional stocks without conferring shareholder rights or market safeguards that characterize regulated securities trading.
Credit: Source link
