One of the key benefits of tokenization is the potential to reduce risks through instant atomic settlement. But if the Securities and Exchange Commission (SEC) approves the stock exchange’s tokenization proposals, that isn’t what Nasdaq intends initially. In September Nasdaq unveiled plans to allow the native trading of tokenized securities. These and broader digital assets topics featured heavily in yesterday’s Q3 2025 earnings call.
Adena Friedman, Chair and CEO at Nasdaq, explained that traders would be able to flag how they wish a transaction to settle. The options would be to “either settle it in the normal way or settle it into a digital wallet infrastructure.” The stock exchange is collaborating with the DTC. She believes that initially digital securities may be available on a couple of blockchains.
Despite the potential to improve settlement speed, the CEO said, “you’ve got to look at kind of a walk-run type of program here, and the overall timing of settlement will remain the same.”
Beyond the short term, she also discussed the longer term benefits of tokenization, which include collateral mobility. That mobility is based on compressed settlement cycles. So outside Nasdaq, tokenized Treasuries and money market funds can settle instantly. She said that tokenization “allows us to look at collateral as much more mobile,” and added, “We also think that if you are able to change the settlement cycles over time, it does continue to reduce risk in the system.”
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