The Securities Industry and Financial Markets Association filed a follow-up letter with the SEC’s Crypto Task Force on Friday, pressing its case that wallet software providers performing broker-like functions should be subject to broker-dealer registration requirements when tokenized securities are involved. The letter is a substantive rebuttal of a counter argument filed earlier this month by the Solana Policy Institute and the DeFi Education Fund, and it arrives as the SEC is actively constructing the regulatory architecture for tokenized securities through a combination of no action letters and prospective rulemaking.
Highlights:
SIFMA’s core argument is that from a retail investor’s perspective, using a wallet application to execute a tokenized securities trade is functionally similar to an equity trading application. The investor selects an asset, reviews a quoted price, and confirms a transaction. The wallet routes the order to a decentralized exchange versus the equity trading app routes it to a national securities exchange or a market maker. The investor sees neither routing decision. SIFMA asks, pointedly: if these workflows are functionally identical, why should the investor protection obligations differ?
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