On the 12th, SEC Chairman Paul Atkins delivered a speech at a roundtable conference related to asset tokenization. Practitioners generally believe that this signals the beginning of asset on-chain migration, and in the coming years, not only will there be a stablecoin wave, but the possibility of more assets like US Treasury bonds and stocks going on-chain will greatly increase.
What potential investment opportunities are there? How will it impact crypto assets? Here is the excellent analysis by practitioners organized by Followin:
"The speech by the new SEC chairman at the crypto asset tokenization working group roundtable last night is worth watching. The main measures for the future 'de-regulation' of crypto assets should start from the three levels of issuance, custody, and trading mentioned by Atkins:
1. Securities are increasingly migrating from traditional (i.e., 'off-chain') databases to blockchain (i.e., 'on-chain') ledger systems. On-chain securities also have the potential to reshape various aspects of the securities market, including issuance, trading, holding, and use. For example, on-chain securities can automatically distribute dividends through smart contracts. Tokenization can also enhance capital formation by transforming originally illiquid assets into tradable investment opportunities. Blockchain technology is expected to expand the various new uses of securities and generate market activities that the current committee rules never envisioned.
2. The core task of the new chairman is to establish a reasonable and clear regulatory framework for crypto assets, formulate clear rules for the issuance, custody, and trading of crypto assets, while combating illegal activities and protecting investors from fraud.
By formally establishing rules, interpretations, and exemptions through legal procedures, setting clear standards applicable to market participants. Enforcement should return to the execution of existing rules, especially preventing fraud and manipulation.
3. Three key token areas
1) Issuance
Hope that the SEC can establish clear and reasonable guidelines for the issuance of crypto assets involving securities or investment contracts. Staff have also begun to clarify that certain crypto assets and distribution behaviors do not apply to securities laws. However, this measure is temporary, with staff studying whether additional exemption mechanisms, safe harbor provisions, and viable paths for crypto asset issuers need to be added.
2) Custody
Further clarify which institutions can be considered 'qualified custodians' under the Advisers Act and Investment Company Act, and provide reasonable exemptions for some common crypto custody methods. The SEC may need to further clarify the application of 'customer protection rules' and 'net capital rules' to crypto custody.
3) Trading
Support registered institutions in providing richer trading products based on market demand, breaking the SEC's previous restrictions on crypto trading. For example, some brokers want to launch an integrated 'super app' combining securities, non-securities, and financial services. Federal securities laws do not prohibit registered brokers from matching non-securities transactions on their ATS platforms, including 'hedging transactions' between securities and non-securities.
Explore ways through rules or guidance to help national securities exchanges more smoothly list crypto assets.
In summary, the SEC and its staff are working to develop a comprehensive regulatory framework for crypto assets, but securities market participants should not be forced to innovate blockchain technology offshore. I also want to study conditional exemption mechanisms that allow new products and services currently hindered by existing rules to innovate under compliance premises."
——qinbafrank@qinbafrank
"Today's speech by SEC Chairman Paul Atkins is very clear: supporting the migration from traditional finance to crypto finance.
This means that in the future, financial databases, including securities, have the opportunity to migrate from off-chain to on-chain. 'Just as audio recordings transformed from analog vinyl records to tapes, and then to today's digital software, with digital audio completely changing the music industry, the migration of on-chain securities may also reshape every aspect of the securities market, which can be achieved through issuance, trading, holding, and use.' The SEC will strive to 'establish practical standards for market participants through rule-making, interpretation, and exemptions'.
This means that, as mentioned a few days ago, crypto stablecoins will usher in their largest outbreak period, and RWA (especially US Treasury bonds and stocks) will truly arrive at their on-chain moment. In this process, how Ethereum will carry the accounting of assets worth tens of trillions of dollars will be the biggest narrative of this cycle, besides crypto AI."
——Blue Fox @lanhubiji
"On-chain assets = a new global capital channel Although the traditional financial market (like US stocks) is huge, it has high barriers and heavy national restrictions, with many individuals and institutions wanting to participate but hindered by layers of obstacles. Asset tokenization + on-chain will open a parallel and open 'new US stocks' for global capital. Anyone who can connect to the chain can participate in the 'on-chain version of Wall Street'. Great."
——Ttyuanli @ttyuanli
"Everyone who deposits U is actually supporting US Treasury bonds, because for example, USDT converted to fiat currency will invest in Treasury bonds, then give everyone an air USDT."
But this is also an important threshold for participating on-chain, and the Americans are really good at playing this game. "Crypto Native teams don't need to waste time creating a US stock tokenization trading platform. Traditional giant securities brokers like Robinhood and Futu will quickly form barriers in this new incremental market space through scale effects, liquidity, and goodwill, and the cash flow income generated by tail-end market demand cannot cover the marginal costs of building a new system. On the contrary, by utilizing existing Crypto RWA and stablecoin infrastructure (such as @OndoFinance, @SkyEcosystem, @Aave, @CurveFinance, @Perena__, @humafinance, @Pendle_fi, @RateX_Dex, etc.), tokenizing US stocks and introducing them to the asset side of stablecoins will enhance asset-side robustness and yield while accelerating the third growth curve of the liability side (stablecoin Token), and fastest achieve the vision of stablecoins reaching a $1 trillion scale by the end of 26. Looking back at history, if 2023 was the year of L2, 2024 is the MEME super cycle, then 2025 will be the stablecoin super cycle." ——NingNing @0xNing0x
