Nasdaq has submitted a filing to the US Securities and Exchange Commission (SEC), in a move which is set to allow for the trading of tokenised securities on its markets.
Specifically, the proposed rule change will enable Nasdaq member firms to trade tokenised versions of equity securities and exchange traded products (ETPs) as regular securities.
If introduced, the integration is expected to provide opportunities for faster settlements, improved audit trails and a more streamlined order to trade to settlement flow.
The move is another development in Nasdaq’s recent efforts to drive digital asset integration with traditional finance in its infrastructure and markets, and follows a recent uptake in tokenisation and blockchain technology across the industry.
Tal Cohen, Nasdaq president, said: “Today’s filing marks an early step in Nasdaq’s journey to bring digital assets technology into the US equities markets and to take a responsible approach to bridge the gap between the digital-asset and traditional-asset worlds.
“Our proposal aims to provide meaningful benefits to markets by integrating new capabilities into the fabric of our financial system and further advancing the world’s most efficient and trusted markets.”
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Additionally, all shares are set to be traded on Nasdaq using the same order entry and execution rules as well as the same identification number, to ensure that the same rights and benefits offered through traditional shares are also enabled for the tokenised form.
The exchange has highlighted its aim to maintain fair trading, stating that the proposal, if successful, would run under the SEC’s existing federal regulations.
“Today, the US equities markets are the most liquid, efficient, and resilient in the world,” added Cohen.
“Leveraging the strength of our markets can provide the most scalable way for blockchain technology to unlock the full benefit for all market participants.”