SEC Chair Paul Atkins recently unveiled a new crypto agenda to modernize securities rules for on-chain financial markets. The idea of migrating all stocks and bonds to blockchain technology is gaining traction, with potential benefits like faster transactions and lower costs. However, experts caution that such a shift could take years to fully implement.

While some predict that major financial players could tokenize stocks and bonds within the next five years, others believe it could be a generational shift. Companies like Robinhood and Kraken have launched stock tokens, but they face challenges such as low liquidity and lack of shareholder rights.

Wall Street firms like BlackRock and Franklin Templeton have introduced tokenized funds focused on U.S. Treasurys, but tokenizing public equities and corporate bonds presents more obstacles. Regulatory updates and legal recognition of blockchain records are essential for true tokenization to become a reality.

Current SEC rules, like Reg NMS, are designed for traditional market structures with intermediaries and central clearinghouses. Transitioning to a peer-to-peer blockchain trading system raises questions about fairness and transparency. Transfer agents still maintain off-chain records alongside blockchain ledgers, as blockchain records are not yet legally recognized as the official source of truth. SEC Chair Paul Atkins announced plans to update securities rules for on-chain financial markets. Tokenization firm Securitize has already partnered with Apollo, BlackRock, and Exodus to tokenize assets. LaValle emphasizes the need for blockchain clearing and settlement for true tokenized security benefits. Regulatory changes and market participation are crucial for full-scale tokenization success.

Read more at Yahoo Finance.: Turning stocks and bonds into crypto-style trades won’t be happening soon. Here’s why.