U.S. SEC Stock Tokenization Exemption Rule Sparks Controversy as Solana, Hedera, and Others Raise Concerns Over Public Chain Access Standards

On October 24, citing Crypto In America, that the SEC's previously implemented innovation exemption mechanism for tokenized securities has sparked industry controversy, with the core debate centering on which blockchains meet the "public and permissionless" access criteria.

Under this exemption, eligible companies may operate tokenized U.S. equity trading platforms under specific conditions without registering as traditional stock exchanges. To date, TSV LLC, OKXICE, and Kephas Corp. have filed notices with the SEC, planning to respectively utilize the Canton Network or Ethereum Layer 2 networks for their operations.

The Solana Policy Institute has urged the SEC to narrow the "permissionless" definition by scrutinizing actual control over transaction validation, censorship, and rule amendments, while Hedera advocates broadening eligibility to include public chains utilizing permissioned validators. Wall Street industry group SIFMA similarly called for clearer standards.

SEC officials noted that eligible companies can commence operations 30 days after submitting the notice, without awaiting individual blockchain approvals, a process that does not equate to regulatory endorsement of those networks. The agency is currently reviewing industry feedback and may issue supplementary guidance.