Fidelity Investments urged the SEC to create a clear regulatory framework that would allow broker‑dealers to offer, custody and trade crypto assets on alternative trading systems (ATS). In comments submitted to the SEC Crypto Task Force, the firm called for comprehensive rules governing the trading of tokenized securities, including tokenized instruments issued by third parties.
Fidelity stressed that tokenized instruments are not uniform: they differ by issuance structure, legal characterization and valuation. Tokenized real‑world assets (RWAs) can represent a wide range of underlying holdings — equities, real estate, bonds, or private credit — and tokenization models grant different rights. In some cases a token reflects an indirect interest through a securities entitlement; in others, the token functions like a securities‑based swap and may be restricted to eligible contract participants.
The submission asked the SEC to close the regulatory divide between centralized and decentralized trading venues and to consider how intermediated and disintermediated markets can coexist. Fidelity recommended updating reporting requirements to reflect the operational realities of decentralized finance (DeFi) platforms and other disintermediated systems that lack a central authority capable of producing the detailed reports the SEC currently expects.
Fidelity also proposed guidance allowing broker‑dealers to use distributed ledger technology (DLT) for ATS operations and recordkeeping. Revising reporting and recordkeeping rules to account for DLT, the firm said, would reduce unnecessary burdens on decentralized systems and better align regulation with emerging market infrastructure.
The filing comes as the SEC under Chair Paul Atkins has signaled openness to around‑the‑clock capital markets and permitted pilot tokenized trading experiments. Separately, U.S. banking regulators — the Federal Reserve, FDIC and OCC — issued a joint statement clarifying that tokenized securities are subject to the same banking capital requirements as their underlying assets, noting that the choice of technology generally does not alter capital treatment.
Fidelity argues that clearer SEC guidance would help bring legal and operational certainty to tokenized markets, supporting broader institutional participation while aiming to preserve investor protections and regulatory consistency.