SEC RFI on Exchanges, ATSs, and Tokenized Securities
Summary
SIFMA provided comments as response to the request for information (“RFI”) issued by Commissioner Hester M. Peirce entitled “And Then Some” requesting feedback from stakeholders on specific questions as related to national securities exchanges (“NSEs”) and alternative trading systems (“ATSs”).
Excerpt
Executive Summary
We are supportive of innovation in the securities markets and believe that innovation is best advanced through proper rulemaking that protects investors. As the Commission considers ways to open equity markets to new participants and products – whether as discussed in this specific RFI or as part of a broader review of existing rulesets – it is important to analyze not just individual changes but also the cumulative effect of all proposed changes.
The focus for any regulatory reforms must remain on protecting investors and maintaining market integrity. The starting assumption should be that established Regulations ATS and National Market System (“NMS”) should continue to apply in full to all otherwise applicable securities, including tokenized securities and the intermediaries that transact with them, regardless of the technology used. This approach was reflected in the March 5, 2026, joint statement by federal bank regulatory agencies on the capital treatment for tokenized securities, which underscored the importance of treating securities in both “traditional” and tokenized forms in a like manner. 1 As the Commission evaluates potential market reforms, we encourage it to engage in thoughtful analyses and processes, recognizing that the continued strength of U.S. equity markets and the durability of new technologies and products is dependent on, not hindered by, clear and durable regulatory requirements.
Regarding this RFI, SIFMA is generally concerned that the questions imply a potential lowering of standards to facilitate operations of a small subset of new entrants (e.g.,, crypto ATSs) or a specific type of new trading model (e.g.,, pair trades combining a security and non-security crypto asset). If the Commission has identified specific areas of concern with Regulations ATS and / or NMS that would require evaluation, they should be addressed through dedicated concept releases or notice and comment processes focused on these specific issues (we would note that Rule 611 and potentially other pieces of Regulation NMS are already being reviewed by the Commission).
This letter details our recommendations and concerns with the questions raised in the RFI, as well as precedents of middle-ground solutions that accommodated innovation in the securities markets while preserving regulatory protections for investors.