Fidelity Investments has called on the SEC to develop a clear regulatory framework for trading tokenized assets on alternative trading systems. In a letter to the regulator’s Crypto Task Force, the asset manager stated it is critical to establish rules for broker-dealers to custody and trade crypto assets. The company also urged the SEC to bridge the regulatory gap between centralized and decentralized trading platforms.
Fidelity Investments has urged the U.S. Securities and Exchange Commission to continue developing a regulatory framework for broker-dealers offering crypto services. The letter was a reply to a recent call for comments from the SEC’s Crypto Task Force.
Fidelity stated it is “critical” for the SEC to create comprehensive rules for trading tokenized securities. The asset manager noted that tokenized instruments have different legal structures and valuation models across various asset classes.
The company explained the complexity of different tokenization models in its correspondence. “In some models, the crypto asset represents a holder’s indirect interest in the underlying security through a securities entitlement, while in others, the crypto asset may constitute a securities‑based swap,” the letter stated.
Fidelity also recommended the SEC bridge regulatory gaps between centralized and decentralized trading systems. The company’s general counsel, Roberto Braceras, wrote that the regulator should consider how both types of venues can evolve and coexist.
This includes overhauling reporting rules that decentralized platforms cannot meet due to a lack of central authority. Fidelity additionally suggested the SEC issue guidance permitting broker‑dealers to use distributed ledger technology for recordkeeping.
The SEC, under Chairman Paul Atkins, has previously signaled support for 24/7 capital markets. Regulators have given approval for financial companies to experiment with tokenized trading.
U.S. banking agencies have clarified that tokenized securities are subject to the same capital rules as their underlying assets. A joint policy statement shared in March from the Federal Reserve, FDIC, and OCC established this position. The agencies stated that issuing technologies do not generally impact a security’s capital treatment.
