Hester Peirce, head of the US Securities and Exchange Commission’s (SEC) Crypto Task Force, said that putting securities on a blockchain “does not have magical abilities to transform the nature of the underlying asset.”
In a July 9 statement, Peirce emphasized that tokenized shares, notes, or entitlements “are still securities,” requiring issuers, intermediaries, and traders to adhere to existing federal law when creating, selling, or transferring them.
Legal obligations
Peirce’s bulletin notes that tokenization can occur in two ways: an issuer can mint blockchain versions of its own shares, or a custodian can wrap third-party securities and issue receipts.
She warned that the second model introduces counterparty risk because the token holder depends on the custodian’s solvency and control of the underlying shares.
Peirce urged distributors to consult the SEC’s Division of Corporation Finance’s “staff statement” on disclosure duties and to meet with agency staff early if they seek bespoke exemptions.
She also flagged that the rules might classify specific token formats as “receipts for a security” or, if they lack beneficial ownership rights, as “security-based swaps” barred from off-exchange retail trading.
Peirce wrote:
“The same legal requirements apply to on- and off-chain versions of these instruments.”
Growing on-chain stock activity
Peirce’s remarks arrive as tokenized equity volumes accelerate. Solana-based stock tokens issued under Backed Finance’s xStocks framework reached a combined market value of $48.53 million as of July 4.
Dashboard snapshots from data provider RWA.xyz show that the total surpassed the $50 million mark on July 6.
Furthermore, xStocks is now moving to other venues. BNB Chain announced that it will list Apple, Tesla, and other equity tokens as BEP-20 assets in partnership with Kraken and Backed, providing users with 24-hour access and DeFi composability.
Market participants largely welcomed the clarity. Backed Finance co-founder Adam Levi said in a statement that the company “designed xStocks to mirror traditional equity custody so regulatory treatment remains straightforward.”
Kraken added that DeFi integrations on BNB Chain will let users post tokenized stocks as collateral without altering their securities status.
Separately, Bitget integrated xStocks into its on-chain platform on July 9, enabling customers to trade the same tokens from their spot accounts without the need for separate wallets.
Peirce closed by signaling openness to modernization, saying the Commission “stands ready to work with market participants to craft appropriate exemptions and modernize rules” where technology exposes gaps.
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