Plume Network’s general counsel, Salman Banaei, said the SEC’s proposed “innovation exemption” could act as a controlled test space for tokenized securities in the US. He said it may allow regulated onchain trading of real-world stocks, but only under strict identity checks, broker oversight, and approved wallets. He also noted that systems like automated market makers could be tested in a limited form. According to him, both DeFi projects and traditional finance firms may resist depending on how the rules are designed.
His comments come as discussions around tokenized stocks continue to grow. Regulators and industry players are still trying to decide how much of the stock market can safely move onto blockchain systems without breaking existing rules.
My prediction is that @SECGov innovation exemption will provide a testing ground for KYCfi for US, mostly, @The_DTCC tokenized securities + directly onchain securities, while providing room to test AMMs. Will still need a broker-dealer to whitelist KYCed wallets. DeFi won’t… https://t.co/fU2xEvxdj9
— Salman Banaei (@banamlas) May 21, 2026
US Securities and Exchange Commissioner Hester Peirce had earlier said the industry should not expect too much from the proposal. Speaking on May 21, she said any exemption would likely be narrow. It would mainly cover digital versions of stocks that already trade in public markets. Her comments followed a Bloomberg report that described early ideas being reviewed by the SEC.
What would the SEC innovation exemption include?
Peirce said the SEC is mostly looking at tokenized versions of real stocks. These would represent shares that already exist in traditional markets.
She added that these tokens would need to match the real asset. This includes rights like dividends and voting power. She also said tokens that only track stock prices without ownership rights are unlikely to be approved.
How would access and trading work?
Experts expect broker-dealers to stay in control of access. Users would need full identity checks before they can trade. Wallets would also need to be approved before use.
Even if blockchain tools like AMMs are tested, they would likely run under strict rules. This means DeFi-style open access would not be fully allowed. Instead, trading would still sit under regulated financial systems.
How big is the market and where is it going?
Tokenized stocks are still small today, at about $1.48 billion onchain. This includes tokenized shares tied to firms like Circle, Strategy, and Google according to data from RWA.xyz.
Some big financial firms once expected fast growth, even into the trillion-dollar range by 2030. But progress has been slower. Regulators are now moving carefully, focusing on safety, structure, and clear rules before wider adoption is allowed.
Meanwhile, the SEC has delayed approval for a wave of prediction-market exchange-traded funds (ETFs), marking a pause in one of the fastest-growing crypto-adjacent product categories. The filings, led by firms including Roundhill, Bitwise, and GraniteShares.
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