SEC exemption for tokenized stocks drives DeFi growth

A temporary exemption granted by the US Securities and Exchange Commission (SEC) is driving significant growth in the decentralized finance (DeFi) sector, specifically for tokenized stocks. The SEC’s ‘Innovation Exemption’ allows Tokenized Securities Venues to facilitate the trading of 1:1 backed US stocks through permissioned automated market makers (AMMs) without registering as a national securities exchange. This relief is valid for five years and applies to real shares with full shareholder rights, excluding synthetic stock tokens.

Following this regulatory decision, several DeFi tokens saw substantial gains. Arbitrum (ARB) rose by 30.26%, followed by Uniswap (UNI) at 27.98% and NEAR Protocol (NEAR) at 27.14%.

Uniswap has emerged as a dominant venue for this activity, attracting approximately $82.8 million in new deposits for tokenized stocks over the last 30 days. The protocol holds a significant share of the $192.6 million total value locked (TVL) in the tokenized stock DeFi market. Much of this volume is concentrated on the Robinhood Chain, where Uniswap captures 73% of all stock token deposits.