- Nasdaq is giving top priority to the proposal to allow trading in “stock tokens,” which it filed with the SEC in September.
- The exchange pointed to full fungibility with traditional stocks, so shareholder rights would also apply to the corresponding tokens.
Two months after Nasdaq filed with the SEC to allow trading in “stock tokens,” Matt Savarese, Nasdaq’s head of digital assets, said tokenized stocks are now a top priority for the company.
Nasdaq wants to start trading stock tokens
In a CNBC interview, Savarese said Nasdaq wanted to reach a conclusion as quickly as possible with the SEC that would allow it to decide on a rule change that would allow this type of trading.
Savarese explained:
“We are not creating a new exotic instrument. The stock is the stock. The rules have been in place for decades, and we don’t want to just completely undermine and upend the entire process.”
He added that investors would continue to retain all rights and interests as shareholders. According to the project, the tokenized stocks are fully fungible with their traditional form, allowing clearing firms and the Depository Trust Company (DTC) to process tokenized orders alongside traditional stocks with the same ticker symbols and CUSIP identifiers.
Savarese praised Nasdaq as the “original innovator” in developing market infrastructure. He compared tokenization to the exchange’s previous transition from a paper-based to an electronic trading system:
“It’s evolutionary. It’s not really revolutionary.”
He further pointed out that the system will be developed gradually while keeping the interests of investors at the forefront.
A timeline for approval was not given. However, Savarese is confident that the SEC is ready to give its approval.
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