Coinbase Seeks SEC Approval to Offer Tokenized Equities in U.S.
Cryptocurrency exchange Coinbase is seeking regulatory clearance from the U.S. Securities and Exchange Commission to launch tokenized equities for American customers, a move that could expand its offerings into traditional financial markets. Paul Grewal, the company’s chief legal officer, said in an interview that Coinbase is pursuing either a “no action” letter or exemptive relief from the SEC. If granted, the approval would allow Coinbase to facilitate the trading of digital tokens that represent shares of publicly traded companies—essentially merging elements of stock trading and blockchain technology. Tokenized equities are not currently available for trading in the U.S. and would mark a new product class for the crypto firm, potentially putting it in direct competition with established retail brokerages such as Robinhood and Charles Schwab. How Coinbase Could Benefit from Tokenized Equities Tokenized equities involve converting traditional shares into digital tokens traded similarly to cryptocurrencies. Advocates argue that this model could lower trading costs, enable 24/7 market access, and accelerate settlement times. However, critics and regulators have flagged several concerns. A recent report from the World Economic Forum highlighted two key barriers: the lack of liquidity in secondary markets and the absence of globally consistent standards for tokenized financial instruments. To offer such services legally in the U.S., a firm typically must register as a broker-dealer. Coinbase, which is not registered as one, was sued by the SEC in 2023 for allegedly operating without proper registration. The regulatory agency later dropped the lawsuit in 2025 under a new administration. Industry Moves and Regulatory Pathways Coinbase is not the only platform exploring tokenized equity offerings. Rival exchange Kraken announced in May that it would roll out tokenized versions of U.S. stocks—dubbed “xStocks”—though these are only available in select markets outside the United States. Grewal said a no-action letter from the SEC would provide assurance that the regulator does not intend to pursue enforcement if the platform proceeds with offering tokenized equities. Such letters are issued at the discretion of SEC staff and do not carry the weight of formal approval, but can offer legal clarity for firms operating in emerging financial sectors.
