Tokenization Isn’t Coming—It’s Here, Says SEC’s Atkins

Atkins says tokenization is inevitable as banks adopt blockchain, pushing regulators to support innovation instead of slowing it.

On-chain settlement offers transparency and reduces delays, prompting regulators to adapt oversight in real time.

U.S. aims to bring digital asset activity onshore, tightening rules after offshore failures like FTX highlighted oversight gaps.

SEC Chair Paul Atkins has said tokenization could take hold within a few years during an interview on FOX Business’ Mornings with Maria. Atkins addressed why the shift is accelerating and how regulators now approach the technology.

Regulators Reassess Their Earlier Approach

Atkins said major banks and brokers already move toward tokenization, and he described the trend as unavoidable. He said electronic trading and blockchain technology now drive a broad transformation across financial systems

He added that the SEC had long followed the market rather than guided it. However, he said the agency recently slowed new innovations by resisting them. This created friction as firms explored digital tools.

He said the SEC aims to change that posture. He said regulators now work to embrace technology instead of blocking it. This shift, he noted, intends to keep U.S. markets competitive. Atkins also said regulators want to apply American rules to emerging digital systems to prevent gaps that once appeared offshore.

Shift Toward On-Chain Settlement

Atkins pointed to predictability and transparency as central advantages of tokenization. He said on-chain settlement may narrow or remove the gap between trade execution and final payment

He said this approach could reduce operational delays that appear in traditional systems. He noted that digital tools now evolve at a pace that forces regulators to adapt in real time. His remarks also referenced recent examples in market oversight

He highlighted the FTX collapse offshore and said LedgerX, which operated under CFTC rules, kept customer assets intact. He said that outcome showed how segregated accounts helped protect customers when broader disruptions occurred.

Broader International Context

Atkins said the United States and Communist China had previously been the only large jurisdictions taking steps that made cryptocurrencies appear restricted. He said this view has changed

He said regulators now want digital asset activity onshore, where rules apply clearly. He added that the shift marks a new phase as agencies seek consistent oversight while markets modernize.

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