SEC Issues “Innovation Exemption” to Facilitate the Trading of Tokenized NMS Stock and Request for Comment

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The U.S. Securities and Exchange Commission announced on Sept. 17, 2026, that it issued an order granting temporary, conditional exemptive relief to "Tokenized Securities Venues" (TSVs) from the Exchange Act's definition of "exchange," enabling them to trade tokenized NMS stock using permissioned AMM Liquidity Pools, and also granted liquidity providers in such pools a temporary conditional exemption from the Exchange Act's definition of "dealer." The exemptions are conditioned on measures including limits on symbols and volume traded, verification that tokenized stock carries the same rights as traditional NMS stock, notice to issuers before listing third-party tokenized stock, use of auditable public smart contracts on a public, permissionless distributed ledger, concurrent trading halts with the underlying stock's primary listing exchange, and public disclosure of TSV operations and trading activity. The SEC states the exemptions are set to expire five years after publication, and the order, to be published on SEC.gov and in the Federal Register, solicits public comment on the Innovation Exemption and potential next steps. Statements attributed to SEC Chairman Paul S. Atkins and Division of Trading and Mark

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