The U.S. Securities and Exchange Commission (SEC) has taken a significant step towards integrating blockchain technology with traditional regulatory frameworks by engaging with prominent Ethereum-aligned organizations.
The SEC’s Crypto Task Force recently convened with representatives from the ERC-3643 Association, Chainlink Labs, the Enterprise Ethereum Alliance, and the Linux Foundation (LF) Decentralized Trust to explore the potential of open standards and compliance frameworks in bridging on-chain technology with existing regulatory requirements. The discussions centered around tokenized securities and how standards such as ERC-3643 and Chainlink’s Automated Compliance Engine (ACE) could facilitate their integration. ERC-3643 is an Ethereum token standard designed to facilitate compliant capital markets, while Chainlink ACE is a smart-contract-based framework tailored for tokenized assets, including securities and real-world assets (RWAs).
Dennis O’Connell, president of the ERC-3643 Association, noted a “noticeable shift in tone and approach” from the SEC compared to previous years, describing the task force as “very welcoming, engaged, and motivated to bring the US into leadership.” He emphasized that the SEC showed an unexpected openness to industry-led standards, stating, “We laid out our case on why, like other industries, including traditional finance, standards are fundamental to growing crypto in the US and enabling securities to come onchain.”
Industry representatives presented comprehensive proposals addressing key components of a regulatory framework for tokenized securities, including identity, compliance, registry, and control mechanisms. While the SEC task force did not take a definitive stance on tokenized securities, O’Connell confirmed they were “open to understanding how new technologies in blockchain meet concerns around identity, control, and compliance.” The meeting was described by O’Connell as a “major step for the industry.”
The ERC-3643 Association and its partners intend to maintain engagement with the SEC Crypto Task Force and other U.S. government agencies, with the goal of seeing the U.S. emerge as a leader in blockchain adoption for capital markets. Further bolstering the positive sentiment, SEC Chair Paul Atkins made supportive remarks regarding tokenization shortly after the meeting, considering the creation of an “innovation exemption” within the SEC’s existing framework to stimulate tokenization. Atkins indicated that the SEC is exploring changes to promote tokenization, including exceptions that would facilitate new trading methods for tokenized securities, acknowledging that “if it can be tokenized, it will be tokenized.”
