TLDR
- Fidelity asked the SEC for clear ATS rules for trading tokenized securities.
- The firm wants broker-dealers to custody and trade crypto assets on regulated platforms.
- Fidelity said tokenized versions of securities should match the status of underlying assets.
- The letter called for support for crypto-security trading pairs and on-chain recordkeeping.
- Fidelity also asked the SEC to address how centralized and decentralized venues can coexist.
Fidelity Investments has asked the U.S. Securities and Exchange Commission to set clear rules for tokenized securities on alternative trading systems. The request focuses on broker trade, custody, and recordkeeping, and it places Fidelity among large firms seeking a defined path for crypto market activity within regulated platforms.
Fidelity calls for ATS rules on tokenized securities
In a letter to the SEC Crypto Task Force, Fidelity said more guidance is needed for broker-dealers that handle crypto assets. The firm said current steps by the agency are helpful, but more rules are still needed. Those rules would cover custody, trading, and crypto-security trading pairs on regulated systems.
Fidelity framed the request around existing market rules and investor protections. It said the agency should adapt legacy frameworks to new technology, while keeping transparency and market integrity. The company’s comments responded to Commissioner Hester Peirce’s request for input on crypto trading on exchanges and ATS platforms.
Broker-dealer custody and token status remain central issues
Fidelity said broker-dealers need clear standards before they can support tokenized securities at scale. The firm asked the SEC to provide “brightline standards” for ATS platforms that list tokenized securities created by third parties. It said that clarity is needed because a broker-dealer may not know every fact behind a tokenized instrument.
The letter also asked the SEC to confirm that tokenized versions of traditional securities should usually keep the same legal status as the underlying assets. That step could reduce friction between on-chain markets and traditional markets. Fidelity said broker-dealers should be able to rely on asset classification without taking excessive legal risk.
Fidelity seeks room for on-chain systems and traditional markets
Fidelity also asked the SEC to address how centralized venues and decentralized systems can operate at the same time. The firm said blockchain-based platforms may offer faster settlement, lower costs, and greater transparency. It also noted that decentralized venues may not have the same safeguards as regulated intermediaries.
The company wants rules that allow on-chain settlement and recordkeeping within a regulated structure. It also wants broker-dealers to support crypto assets and crypto-security pairs more clearly. Fidelity wrote that it looks forward to “additional guidance on a number of other areas critical for broker-dealers to offer, custody, and trade crypto assets.”
The request adds to a broader push for tokenized securities rules for ATS broker trade. It also reflects growing interest in linking crypto infrastructure with regulated market systems. For now, Fidelity’s message to the SEC is direct: set tokenized securities rules for ATS broker trade, and give firms a clear framework for custody, trading, and recordkeeping.
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