Perpetuals.com seeks to utilize the U.S. Securities and Exchange Commission (SEC)’s “innovation exemption” to trade tokenized stocks.
What is The Innovation Exemption?
Passed on September 17, “the innovation exemption is available for trading in certain types of tokenized securities—(I) those tokenized by or on behalf of its own issuer, or (II) those tokenized by a third party, in each case only if the tokenized version provides “the same rights and privileges” as the security itself.”
SEC Scaffolding vs. Clarity Bill Stalling: A Cryptocurrency Legal Framework
The order is a concrete step in the Securities and Exchange Commission’s ‘Project Crypto’ effort to permit tokenized securities to trade onchain. This comes after the stalling of the Clarity Bill in the Senate, where a legislative framework for cryptocurrency and virtual assets that the Bill seeks to address has otherwise not yet been made.
The Exemption, In Focus
According to Davis Polk insights: “The order offers a path for onchain secondary trading of listed equities, that the [Securities and Exchange] Commission believes should allow experimentation and innovation, while limiting the risk of spillover into the traditional national market system.”; this reflects a certain leeway being afforded by the SEC for cryptocurrency trading platforms.
The plan is that through five years, ending in 2031, a permissioned blockchain system is created to trade tokenized versions of exchange-listed stocks without registering as an exchange.
The exemption can be summarized as follows:
- Duration
- Effective September 17, 2026, for five years; subject to modification by the Commission
- Eligible securities, Issuer-tokenized or certain third party-tokenized NMS stock
- Excludes synthetic and linked products, security-based swaps, rights and warrants
- Trading limits (aggregated across affiliated venues)
- Tier 1: 75 symbols and 0.25% of average daily volume per stock;
- Tier 2: 250 symbols and 2.5% of average daily volume per stock
- Issuer objection right
- 30 calendar days from receipt for each TSV
*A TSV is a group of persons that brings together buyers and sellers of tokenized stock by providing one or more Automated Market Maker liquidity pools for permissioned participants to interact and agree to the terms of a trade; and setting standards for access to trading on those pools. (Davis Polk, 2026)
The token must be a listed class, not a new security—these are those that are already listed on the market, under one of three classes: Class A, Class B, or Class C stocks.
