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The World Federation of Exchanges opposes the US SEC's regulatory exemption for tokenized stocks for encryption companies.

According to a report by Reuters on November 27, Deep Tide TechFlow news states that the World Federation of Exchanges (WFE) has written to the U.S. Securities and Exchange Commission (SEC) opposing the agency's plan to potentially provide regulatory exemptions for encryption companies selling “tokenized” stocks.

The WFE warned in a letter dated November 21 that such exemptions could pose risks to investors and undermine market integrity. Its members include major exchanges such as Nasdaq and the German stock exchange. WFE CEO Nandini Sukumar stated: “The SEC should not grant exemptions to companies attempting to circumvent regulatory principles that have protected the market for decades.”

Currently, multiple encryption companies plan to sell crypto tokens linked to listed stocks to retail investors, but need a no-action letter or exemption from the SEC to sell such products in the United States. SEC Chairman Paul Atkins previously stated that the agency is developing an “innovation exemption” policy that allows crypto companies to experiment with new business models.

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