The issue of coded securities becomes clearer as the SEC signals its issuance

SEC gives the green light for token securitization

The U.S. Securities and Exchange Commission (SEC) has officially signaled its intention to initiate regulation of token securitization and other blockchain-based financial instruments, according to remarks by SEC Chairman Gary Gensler in a February 4, 2026, speech at the “ SEC Speaks ” conference of the Institute of Practice Law in Washington, D.C.

“ Putting stocks, bonds, or fund shares on the blockchain does not remove them from federal securities law. Tokenization is a technology, not a regulatory exemption .”

Key areas of focus are being considered.

Gensler said the SEC’s Corporate Finance Bureau and the Bureau of Exchanges & Markets are “actively working” on the proposed rules and explanatory guidance, with a draft or preliminary notice of proposed rules (ANPR) expected to be published “in the coming months” — possibly as early as the second quarter of 2026.

• The definition of " security " applies to coded instruments.

• Depository standards for blockchain-based securities

• The obligations of transfer agents and brokers when facilitating encrypted transactions.

• Information disclosure requirements for issuers of coded securities.

• Secondary market trading venues (including decentralized exchanges and ATS platforms)

• Handling of tokenized securities in accordance with Regulation D , Regulation A+ , and the Crowdfunding Regulation.

Gensler left open the possibility of applying a conditional safe zone for tokenized securities that meet stringent criteria (adequate reserve requirements, daily confirmation, qualified custody, and transparent redemption), similar to how certain stablecoins are handled under the GENIUS Act.

This announcement—despite lacking specific details—shows the clearest indication yet that the SEC plans to move beyond individual case enforcement actions and instead develop a structured legal framework for tokenized physical assets (RWAs), including stocks, bonds, funds, Treasury bonds, and other securities issued or traded on a distributed ledger.

Opportunities that arise from regulatory clarity.

Clear regulations can encourage adoption by organizations across many sectors:

• The involvement of stockbrokers in the stock market is coded.

• Integrating custody services for digital copies of traditional assets.

• Modernizing payment processes, with the potential to leverage blockchain technology.

• Expand secondary trading platforms with listings of regulatory-compliant tokens.

Organizations have historically viewed regulatory uncertainty as a major barrier to scaling up coding initiatives. Even greater clarity helps reduce the premium of legal risk and compliance friction.

Our review

The SEC's signal that it will pursue formal regulatory processes for tokenized securities is the most significant legal development in the real asset space (RWA) since the GENIUS Act for stablecoins. It shifts the discussion from “ are these securities? ” to “how do we regulate tokenized securities in a way that protects investors while allowing innovation?”

For issuers like BlackRock, Franklin Templeton, Ondo, Securitize, and others, this is a long-awaited step toward mainstream legitimacy. For investors, it means that crypto assets could soon move from specialized DeFi experiments to regulated products accessible through brokerage firms.

The gray area is ending — the era of regulation is beginning. The next 12-18 months will determine whether the United States becomes the global leader in tokenized real assets or whether foreign jurisdictions seize this opportunity.

Disclaimer: The information presented in this article is the author's personal opinion in the field of cryptocurrency. This is not financial or investment advice. All investment decisions should be based on careful consideration of your personal portfolio and risk tolerance. The views expressed in this article do not represent the official stance of the platform. We recommend that readers conduct their own research and consult with experts before making any investment decisions.

Compiled and analyzed by HCCVenture

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