Key Takeaways

• Attendees included representatives from Payward, Inc. and Kraken Securities LLC, along with two lawyers from Wilmer Cutler Pickering Hale and Dorr LLP.
• The issues reportedly discussed included the structure of a tokenised trading system, how transactions would be processed, and which provisions of federal securities laws could apply.

Leading crypto exchange Kraken met with the US Securities and Exchange Commission’s (SEC) Crypto Task Force officials on Monday, 25 August, to discuss the exchange’s plans to develop a tokenised trading system. The meeting followed Kraken’s launch of xStocks earlier this year, an initiative aimed at tokenising over 50 US stocks and exchange-traded funds (ETFs).

The agenda, prepared by Kraken, outlined topics for discussion with the SEC’s Crypto Task Force. The issues reportedly discussed included the structure of a tokenised trading system, how transactions would be processed, and which provisions of federal securities laws could apply. The agenda also covered the legal requirements for operating such a system and the potential benefits that tokenisation might provide.

Kraken presented tokenisation as a technology capable of supporting capital formation and expanding market access. The company indicated that greater regulatory clarity would help define how such a system could function within existing frameworks.

According to a memorandum filed after the meeting, attendees included representatives from Payward, Inc. and Kraken Securities LLC, along with two lawyers from Wilmer Cutler Pickering Hale and Dorr LLP. The memorandum also recorded the list of proposed attendees and confirmed that the agenda focused on both operational and regulatory aspects of the trading model.

The latest development comes days after Kraken and tokenisation platform Backed Finance announced an expansion of xStocks to the Tron blockchain. Earlier this week, leading regulators had written to the SEC, raising concern over the growing appeal of tokenised stocks, arguing that they lack the investor protections built into traditional markets and therefore pose a significant risk to investors