NextFin News - The Securities and Exchange Commission just handed public companies a veto over having their shares tokenized, and Carlos Domingo, chief executive of Securitize, believes they will not use it. Speaking in a television interview on Tuesday, Domingo argued that issuers will not opt out of the new regime — a bet that turns a safeguard designed to protect companies into the very mechanism that could let tokenized stocks spread across the U.S. market.
The Securities and Exchange Commission issued an order last Thursday creating a five-year "Innovation Exemption" that clears a regulatory path for trading venues to issue tokenized representations of publicly traded U.S. stocks, effective immediately. The order, part of the agency's Project Crypto initiative, comes with two conditions that have dominated the debate: token holders must keep the same rights as traditional shareholders, and companies must be able to object to having their securities represented as tokens. Under the exemption's design, a trading platform must notify the issuer of its intention to tokenize the shares and wait 30 days after the company receives the notice before making the token available; if the company objects within that window, the token cannot be listed.
That 30-day window is the opt-out. And Domingo's claim — that companies will not take it — is the crux of the story. The question is not whether issuers have the right to say no. It is whether saying no is in their interest once the alternative is a tokenized share that pays dividends, carries voting rights, and trades around the clock.
The Opt-Out That Isn't Meant to Be Used
On its face, the exemption looks like a win for issuers. For the first time, a public company can block a third party from putting its stock on a blockchain. Brett Redfearn, president of Securitize and a former director of the SEC's Division of Trading and Markets, described the design in an interview earlier this month: "I believe that the innovation exemption is likely going to do something akin to an issuer opt-out." A firm that wants to tokenize a company's stock would notify it, and the issuer would get "a certain period of time, I don't know, 30 days or something, to, like, say yay or nay." Silence means consent.
That structure was not the starting assumption. Early expectations were that the exemption would require no company sign-off at all, and the idea drew pushback from the Securities Transfer Association, the trade group representing the firms that maintain shareholder records. In a July 1 letter to the SEC, the group argued the exemption "should apply only to Issuer-Sponsored Tokens" — meaning tokenization should happen with the issuing company's involvement, the model Securitize itself builds. The final order splits the difference: issuers get a veto, but only a temporary one, and only if they actively exercise it.
SEC Chair Paul Atkins framed the move as a deliberate experiment rather than a permanent settlement. "The Innovation Exemption is designed to resolve challenges that have prevented responsible innovation from taking root in the United States while providing investor protections and market integrity standards," he said in a statement. He added that the commission is "not cementing today's technology as the standard for tomorrow," but instead letting the market evolve while the agency monitors it to inform "a nimbler and future-ready regulatory framework." The exemption is not a formal rulemaking; it is a five-year probe with the explicit aim of generating evidence for Congress and for eventual durable rules.
The tension in Domingo's argument is deliberate. A veto that exists but is rarely used is more powerful for the tokenization industry than no veto at all, because it disarms the most potent political objection — that companies are losing control of their own shareholder registries — while leaving the economic logic of on-chain shares intact. If issuers do not object, the exemption quietly normalizes tokenized representation of U.S. equities without a single issuer ever having signed a contract.
Why Issuers Might Prefer Tokenization to a Fight
The strongest reason companies may not opt out is that the exemption forces tokenized shares to behave like real shares. Holders must receive the same economic and shareholder rights — dividends, voting, corporate actions — as holders of the underlying stock. That removes the central complaint that made tokenized stocks toxic in their first cycle: that they were synthetic derivatives decoupled from the company, trading offshore with no claim on the register.
The flashpoint was a public fight this summer between the chief executives of Robinhood and AMC. AMC CEO Adam Aron objected to Robinhood's stock-token model, arguing that creating exposure to AMC stock without the issuing company's involvement undermined the traditional relationship between companies and their shareholders. Robinhood's CEO, Vlad Tenev, pushed back: "Going onchain shouldn't give the issuer a veto it never had offchain." This week, Robinhood said it is moving to address the concern, planning to let token holders redeem their tokens for the underlying shares on a 1:1 basis and adding voting rights.
That convergence matters. Once a tokenized share delivers the same rights and the same redemption path as a traditional share, the issuer's remaining objection is not about shareholder protection — it is about control. And here the calculus flips. A tokenized share that trades 24 hours a day, settles instantly, and can be fractionalized expands the pool of potential buyers without diluting the company or changing its capital structure. The company collects no fee from secondary trading, but it also bears no cost.
Domingo has put his own company where his argument is. Securitize listed on the New York Stock Exchange on July 2 under the ticker SECZ through a merger with Cantor Equity Partners II, a Cantor Fitzgerald SPAC, at a $1.25 billion pre-money valuation, raising roughly $400 million including a $225 million oversubscribed private investment in public equity. At the listing, nearly $300 million of shares were tokenized on Solana and Avalanche. In an August post on X, Domingo wrote:
If I were the CEO of a publicly traded company (oh wait!) I would also not want people creating offshore derivatives of our stock that trade all over the place. This is why we tokenized our own stock natively and in the US, in a fully compliant way.
The message is that native, compliant tokenization is the answer to the offshore-derivatives problem — and that issuers who understand the distinction will choose it. Securitize reported approximately $5 billion in on-chain assets under management on its second-quarter earnings call in August, and Domingo framed the moment in categorical terms: "The question is no longer whether capital markets move onchain; it's how fast and which companies will build the regulated infrastructure that enables that transition."
The Market Is Bigger Than Treasuries
Tokenized stocks are a small slice of today's tokenized-asset market, which is still dominated by tokenized government debt. The on-chain real-world-asset market stood at roughly $27.65 billion as of April 2026, according to RWA.xyz, with tokenized U.S. Treasuries accounting for the bulk. Domingo has argued that tokenized equities and exchange-traded funds, not private credit or Treasury products, will be the asset class that drives the market into the trillions. Speaking at ETHConf in June, he said bringing stocks and ETFs on-chain could grow the tokenized-asset market from roughly $30 billion to as much as $5 trillion, on the logic that even a small share of the roughly $150 trillion global equities market moving on-chain would be transformative.
Independent forecasts run in the same direction. A joint report from Boston Consulting Group and Ripple projected the market for tokenized financial instruments could reach $18.9 trillion by 2033, a 53 percent compound annual growth rate, with a conservative scenario of $12 trillion and an optimistic one of $23.4 trillion. The same report identified five barriers that remain: fragmented infrastructure, limited interoperability across platforms, uneven regulatory progress, inconsistent custody frameworks, and a lack of smart-contract standardization. Those are not trivial obstacles, and they are why the exemption's five-year horizon is as much a recognition of uncertainty as it is an invitation.
Securitize's own market signal is the stock. SECZ traded around $10.91 in the session ended September 19, giving it a market capitalization of roughly $1.78 billion, with a 52-week range of $5.14 to $14.05. In mid-September, insiders bought into the story: the company disclosed purchases on September 14 by CEO Carlos Domingo (318,300 shares for $2.61 million), CFO Jose Francisco Flores Junco (161,100 shares for $1.32 million), and COO William Dawson Miller (109,900 shares for $902,390). Insider buying is not a thesis, but when the people who must execute the tokenization strategy are buying the stock, the market reads it as conviction.
The Counter-Case: Issuers Will Defend the Register
The bear case against Domingo's bet is straightforward and it has a named precedent: AMC already objected to having its stock tokenized without its involvement. The strongest counter-thesis is that issuers will use the opt-out not because tokenized shares are harmful to investors, but because they do not want to cede any control over who appears on their shareholder register, how their stock trades, or when their company is exposed to 24-hour price swings. A company that objects loses nothing tangible under the exemption — no fee, no liquidity, no capital — but it retains the comfort of a known system. Corporate treasurers and general counsels are paid to avoid unforced errors, and "do nothing" is the default position in corporate America.
There is also a market-structure objection. Tokenized shares trading around the clock could fragment price discovery across time zones and venues, with thinner overnight liquidity amplifying moves that would be absorbed during regular hours. The exemption includes volume limits to mitigate this, but limits are a constraint on the very liquidity benefit that makes tokenization attractive in the first place. If the product is throttled enough to be safe, it may be throttled enough to be uninteresting.
This counter-thesis is real, but it conflates the first wave with the second. The first wave of tokenized stocks was synthetic, offshore, and rights-stripped — the kind Robinhood built and AMC fought. The exemption is designed to produce a second wave that is rights-preserving, redeemable, and domestically regulated. AMC's objection was to the first kind. Domingo's argument is that issuers will not object to the second. The counter-thesis holds only if issuers cannot tell the difference, or if they decide that any tokenization, however compliant, is a threat to control.
The signal that would falsify Domingo's view is concrete: if a named S&P 500 issuer formally objects within a 30-day window after receiving a tokenization notice, or if fewer than 5 percent of S&P 500 companies have any tokenized representation twelve months after the exemption takes effect, the "companies won't opt out" thesis is wrong. The first objection would show that the veto is more than a formality; the second would show that the market is not adopting even when the path is clear.
What Comes Next
In the short term, the action will be in notices and non-objections. Watch for the first trading venue to file a tokenization notice under the exemption and for whether the named issuer responds within the 30-day window. The first few cases will set the tone for the whole regime: a quiet non-objection is worth more than any executive speech, because it turns the opt-out from a weapon into a rubber stamp.
Over the medium term, the question is whether tokenized shares develop real secondary liquidity or remain a niche product for crypto-native brokers. The exemption's volume limits, the state of custody infrastructure, and the progress on smart-contract standardization will determine whether the market builds depth or stays thin. Robinhood's move to add redemption and voting is the kind of concession that could unlock U.S. distribution; if other venues follow, the product stops being a regulatory arbitrage play and starts being a distribution channel.
In the long term, the structural call is that tokenization is a regime shift in market infrastructure, not a cyclical trade. The mechanism is simple: once a share can move on-chain with the same rights, instant settlement, and 24-hour access, the marginal cost of holding it falls and the marginal utility of trading it rises. That does not revert. What is cyclical is the pace — the stock prices of tokenization firms, the flow of IPOs, the quarterly AUM prints. Those will fluctuate with risk appetite. The direction of the infrastructure migration will not.
Scenarios: the base case is gradual adoption, with a handful of crypto-friendly issuers and a growing set of tokenized ETFs, but no mass opt-in for a year or more. The upside case is a marquee issuer declines to object, prompting a cascade of non-objections and a rush of venue competition. The downside case is the first objection — a well-known company says no, and the exemption stalls as venues decide the legal risk is not worth it.
The real story of the SEC's exemption is not the veto it created. It is the veto it expects to go unused. If Domingo is right, the 30-day opt-out will become the quietest revolution in U.S. equity markets: a right that protects issuers precisely by never being exercised.
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