The US Securities and Exchange Commission (SEC) is set to further delay its planned “innovation exemption” for tokenized securities amid concerns from the White House and Wall Street, according to industry sources. The exemption was expected to make it easier for firms to issue and trade tokenized stocks and other securities on blockchain networks.
🚨Scooplet: The @SECGov’s tokenization innovation exemption has been “further delayed,” with details expected to remain under wraps for the time being, per a source familiar with the matter.
Part of the reason, I’m told, could be that the tokenization section of the Clarity Act…
— Eleanor Terrett (@EleanorTerrett) August 13, 2026
The White House is reportedly concerned that moving ahead while Congress debates the CLARITY Act could complicate the legislation, while Wall Street wants major market-structure changes to go through a formal rulemaking process.
The SEC’s plan is aimed at giving firms a controlled way to test blockchain-based securities trading under existing securities laws. SEC Chairman Paul Atkins has strongly supported tokenization, which could eventually allow assets such as stocks and bonds to trade on blockchain infrastructure, potentially with faster settlement and longer trading hours.
However, traditional financial firms are concerned about how tokenized securities would fit into the existing US market structure. The Securities Industry and Financial Markets Association (SIFMA), which represents major broker-dealers and investment banks, has argued that broad changes should not be introduced mainly through exemptions or no-action relief. It wants major market-structure changes to be considered through a transparent process involving public consultation.
One major concern is how brokers would meet their best-execution obligations if tokenized securities begin trading on blockchain-based venues or automated market makers. Existing US equity rules are built around a network of traditional exchanges and other regulated trading venues. Tokenized markets could operate differently, creating questions about pricing, liquidity, transaction costs and investor protection.
The White House has a different concern. According to industry sources, officials worry that a broad SEC exemption could complicate negotiations over the CLARITY Act, which is intended to establish a wider federal framework for digital assets. This does not mean the administration is opposed to tokenization. Rather, the concern is whether the SEC should make significant changes while Congress is still deciding the future market structure.
The delay comes as tokenization is gaining momentum across traditional finance. Nasdaq, the New York Stock Exchange and other major financial institutions are developing blockchain-based securities infrastructure, while the Depository Trust & Clearing Corporation has also been testing tokenized securities. Analysts have estimated that the tokenized asset market could eventually reach trillions of dollars.
The SEC’s decision therefore reflects a growing debate over how quickly tokenization should move into mainstream finance. Crypto companies want room to innovate, while Wall Street wants existing investor and market protections to remain in place. The SEC now has to find a balance between the two sides while also considering the broader legislation being debated in Washington.
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