Federal Register #2026-19388

SEC Temporary Exemptions for Distributed Ledger Trading Venues and Liquidity Providers for Tokenized NMS Stocks

This SEC order grants temporary conditional exemptions to support innovation in securities trading using distributed ledger technology. - Government Buyer: - U.S. Securities and Exchange Commission (SEC) - Scope of Exemptions: - Temporary exemption for Tokenized Securities Venues (TSVs) from the definition of 'exchange' under the Exchange Act - Enables permissioned trading of Tokenized NMS Stock using Automated Market Maker (AMM) Liquidity Pools - Subject to transparency, trading limits, and operational safeguards - Temporary exemption for liquidity providers (Covered Firms) in AMM Liquidity Pools from the definition of 'dealer' - Subject to operational, disclosure, and notification conditions - Proposed amendment to Cboe C2 Exchange fee schedule for Step Up Mechanism auctions - Clarifies fee treatment for liquidity adding/removing orders - OEMs and Vendors: - No specific OEMs or commercial vendors are named; this is a regulatory action, not a procurement - Products/Services Requested: - No physical products or commercial services are being procured - Regulatory exemptions and rule amendments are the focus - Unique/Notable Requirements: - Exemptions are conditional, requiring operational safeguards, transparency, and trading limits - Applies specifically to permissioned trading venues and liquidity providers using distributed ledger technology - Public comment is requested on these exemptions - Period of Performance: - Exemptions are effective for five years, from September 17, 2026, through September 17, 2031 - No contract value or procurement competition is involved

Description

The Securities and Exchange Commission has issued an order granting temporary conditional exemptive relief from certain definitions in the Securities Exchange Act of 1934. This relief pertains to the use of certain distributed ledger trading venues for tokenized NMS stocks and liquidity providers for such stocks. The order also requests public comment on these exemptions. The relief facilitates permissioned trading of tokenized NMS stock using automated market makers and liquidity pools. The order aims to support innovation in securities trading involving distributed ledger technology while protecting investors.

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