Kraken’s SEC Talks Test US Tokenized Trading
On August 25, Kraken met the SEC’s Crypto Task Force to present its blueprint for tokenized trading in U.S. markets. The agenda outlined system architecture, asset lifecycle, and compliance with U.S. securities law, including Exchange Act registration, custody rules, and transfer agent functions. Kraken argued that tokenized trading can deliver faster settlement, fractional ownership, and cost savings, citing $26 billion in blockchain-based real-world assets (including $7 billion in U.S. Treasury tokens). The dialogue follows Kraken’s 2023 SEC lawsuit dismissal and the SEC’s May 2025 custody guidance for tokenized securities. Globally, jurisdictions like the EU and Singapore have advanced tokenization frameworks, raising regulatory arbitrage risks in the U.S. sector. As markets eye on-chain fund launches by Franklin Templeton and BlackRock, clearer SEC guidance will determine whether tokenized trading systems can scale within existing U.S. securities law.
Neutral
Kraken’s talks with the SEC mark a constructive regulatory engagement. While tokenized trading remains in the exploratory stage, this dialogue reduces legal uncertainty and may pave the way for compliant on-chain trading systems. Historically, SEC guidance—such as the 2020 digital custody pathway—helped platforms develop business models. However, without formal rulemaking, adoption and trading volumes will likely remain limited in the short term. Over the long term, clear SEC rules could facilitate the scaling of tokenized trading and attract institutional investors, which would have a bullish effect. Given the current preliminary nature of discussions and absence of binding decisions, the immediate market impact is neutral.