Citadel Securities Urges SEC for Equal Regulation on Tokenized and Traditional Stocks

According to BlockBeats, Citadel Securities, one of the world's largest market makers, has recently urged the U.S. Securities and Exchange Commission (SEC) to apply the same regulatory standards to tokenized stocks as it does to traditional stocks. In a letter to the SEC's crypto working group this week, the company emphasized that regulatory bodies should avoid granting exemptions from securities rules and instead focus on market liquidity and investor protection. Citadel Securities stated, "In short, while we strongly support technological innovations aimed at addressing market inefficiencies, attempting to issue 'securities-like' products through regulatory arbitrage is not innovation." TD Cowen analyst Jaret Seiberg also highlighted in a report on Monday that there is uncertainty surrounding tokenized trading mechanisms, with some challenges related to optimal price discovery. "The traditional stock trading system requires execution at the national best price, which creates a multi-platform trading environment. We believe that maintaining this mechanism will be difficult after stock tokenization," Seiberg noted. Citadel Securities advocates that the SEC should not grant exemption permits and suggests advancing rule-making through roundtable discussions. "The commission must establish a prudent and transparent evaluation process, including a public comment period and a comprehensive cost-benefit analysis," the company emphasized in its letter.