Mark Uyeda, the acting chairman of the Securities and Exchange Commission (SEC), has proposed the establishment of a conditional regulatory sandbox specifically for blockchain-based securities trading.
During the second roundtable of the SEC Crypto Task Force on April 11, Uyeda discussed the idea of implementing a time-limited, conditional exemptive relief framework to encourage innovation in the sector while ensuring regulatory oversight.
This framework would allow both registered and non-registered entities to explore blockchain-based trading solutions under defined conditions without full regulatory approval.
Uyeda encouraged feedback from market participants on the most effective ways to implement such exemptive relief.
Federal framework to enhance crypto trading
Uyeda recognized the challenges posed by the current regulatory landscape for digital asset trading platforms, many of which operate outside federal jurisdiction under state-level regulation.
He suggested that a more accommodating federal regulatory framework could streamline compliance for platforms dealing with tokenized securities and non-security digital assets.
However, existing federal securities laws present obstacles to the integration of blockchain-based systems into traditional securities markets, particularly in relation to broker-dealers and national securities exchanges.
Despite these challenges, Uyeda highlighted the operational advantages offered by distributed ledger technology, including real-time collateral management, increased capital efficiency, and continuous trading through decentralized protocols.
