<p>In a landmark move that signals a new chapter for both Wall Street and the blockchain industry, the U.S. Securities and Exchange Commission (SEC) has officially approved Nasdaq’s pilot program for the tokenized settlement of select securities.</p>



<p>Announced on March 18, 2026, this decision gives Nasdaq the green light to tokenize and settle Russell 1000 stocks and major ETFs using blockchain technology. </p>



<p>The SEC is publicly endorsing the use of distributed ledger technology at the heart of America’s equity markets, and the ripple effects will be felt from Main Street brokerage accounts to the most sophisticated crypto trading desks all over the world.</p>



<h2><strong>Breaking Down the SEC’s Approval</strong></h2>



<p>The SEC has approved a test program that will allow Nasdaq to turn certain stocks into digital tokens on a blockchain. This will include major companies from the Russell 1000 index as well as some popular ETFs.</p>



<p>Even though these stocks are being &#34;tokenized,&#34; they will still be processed through the same system that handles regular stock trades today, known as the Depository Trust Company. So nothing changes in terms of how trades are officially cleared and settled behind the scenes.</p>



<p>Crucially, the tokenized shares are fully fungible with their traditional counterparts. They carry the same CUSIP identifier, the same voting rights, and the same dividend entitlements. </p>



<p>From a legal and economic standpoint, a tokenized share of Apple (NASDAQ:AAPL) or a tokenized unit of the SPDR S&amp;P 500 ETF is identical to the conventional version. The only difference is that it exists and moves on a blockchain.</p>



<p>Another important point is that these tokenized shares will trade in the same market as regular shares. Nothing will look different. But underneath, the technology powering the system is becoming faster and more modern, which could have a big impact over time.</p>



<h2><strong>Blockchain Settlement vs. T+1: Why the Difference Is Huge</strong></h2>



<p>Tokenized securities solve a major problem that investors and institutions have struggled with for a long time, which is delay.</p>



<p>Before, when you buy a stock, you do not actually receive it immediately. The transaction goes through a multi-step clearing and settlement process that takes one full business day (T+1) to complete. </p>



<p>That lag creates counterparty risk, ties up capital as collateral, and introduces operational complexity across thousands of financial institutions.</p>



<p>However, with blockchain-based tokenized settlement, everything happens almost instantly.</p>



<p>When a trade executes, both the payment and the securities transfer can happen simultaneously and automatically via a smart contract, with no need for a lengthy reconciliation process between intermediaries.</p>



<h2><strong>How Tokenization Paves the Way for Round-the-Clock Trading</strong></h2>



<p>One of the most talked-about implications of tokenized securities is the possibility of round-the-clock trading just like the crypto market.</p>



<p>Because tokenized stocks live on a blockchain, there is no technical reason they could not trade at 2:00 AM on a Sunday, or during a holiday that closes conventional exchanges. </p>



<p>Even though the SEC approval does not immediately mandate 24/7 trading, it lays the foundational infrastructure for it. </p>



<p>As the pilot matures and regulators grow comfortable with blockchain-based settlement, extended trading hours become an increasingly plausible next step.</p>



<p>For global investors, particularly those in Asia and Africa who have long found U.S. market hours inconvenient, this could be transformative. </p>



<p>A trader in Tokyo or Lagos could buy and settle shares of an S&amp;P 500 ETF during their local business hours, without waiting for New York to open.</p>



<h2><strong>What This Means for Crypto and the RWA Narrative</strong></h2>



<p>When the world’s second-largest stock exchange and the SEC jointly validate blockchain settlement, it signals to the entire financial industry that RWA tokenization is more than a speculative experiment.</p>



<p>The DTC integration means tokenized Nasdaq securities will settle on proven, regulated infrastructure. This will pressure DeFi protocols to match the same robustness and reliability standards.</p>



<p>As tokenized equities and tokenized crypto assets increasingly coexist in the same digital ecosystem, new cross-asset strategies will emerge, further blurring the line between TradFi and DeFi.</p>



<p>The approval is a clear message from the SEC that it is willing to engage constructively with blockchain innovation in capital markets. This signal could accelerate pending approvals for other tokenized finance products.</p>



<h2><strong>What Investors Should Watch Out For</strong></h2>



<p>For investors trying to position around this development, several areas are worth monitoring closely:</p>



<h3><strong>RWA-focused crypto protocols</strong></h3>



<p>Projects that specialize in on-chain tokenization of real-world assets stand to benefit as the market expands and institutional interest grows.</p>



<h3><strong>Financial infrastructure stocks</strong></h3>



<p>Companies providing clearing, custody, and settlement services will face disruption, but also significant new revenue opportunities as they adapt.</p>



<h3><strong>ETF providers</strong></h3>



<p>As fractional ownership becomes more accessible through tokenization, demand for diversified, low-cost investment vehicles could increase further.</p>



<h3><strong>Global brokerages</strong></h3>



<p>Firms that can offer tokenized settlement to international clients will hold a meaningful competitive edge as 24/7 trading becomes realistic.</p>



<p></p>



<p>The SEC’s approval of Nasdaq’s tokenized settlement pilot is one of the most consequential financial regulatory decisions of the decade. It validates blockchain technology as a legitimate settlement infrastructure for mainstream U.S. equities, opens a credible path to near-instant settlement and 24/7 trading, and dramatically accelerates the convergence of traditional finance and the digital asset ecosystem.</p>



<p>The pilot launch expected in Q3 2026 will be one of the most closely watched events in markets this year.</p>



<p><strong><em>Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been edited for content or accuracy.</em></strong></p>

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<p>The SEC has approved Nasdaq's pilot program for tokenized settlement of select securities, allowing the tokenization of Russell 1000 stocks and major ETFs using blockchain technology. This move aims to modernize the settlement process, reducing delays and counterparty risks associated with traditional trading. Tokenized shares will trade alongside regular shares, maintaining the same rights and identifiers. The approval could pave the way for round-the-clock trading and signals a shift towards integrating blockchain in capital markets, impacting both traditional finance and decentralized finance.</p>

- The U.S. Securities and Exchange Commission (SEC) has approved Nasdaq’s pilot program for the tokenized settlement of select securities, impacting Wall Street and the blockchain industry.  
- The program will tokenize Russell 1000 stocks and major ETFs, allowing for near-instant settlement and the potential for 24/7 trading, transforming how trades are executed.  
- This decision validates blockchain as a settlement infrastructure and could lead to the emergence of new cross-asset strategies between traditional finance and digital assets.

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SEC Greenlights Nasdaq's Tokenized Settlement Pilot: What It Means For Investors