SEC unveils transfer agent proposal, schedules discussion on 24/7 U.S. trading

The U.S. Securities and Exchange Commission released an agenda for its 24-trading roundtable and put forward a new transfer-agent rule with blockchain implications.

— Continuous trading may soon become a reality across broader U.S. securities markets, with the Securities and Exchange Commission hosting a roundtable this month to examine the idea.

— The agency also introduced a rule aimed at updating its regulations governing transfer agents, explicitly incorporating blockchain technology considerations into the traditional function.

The U.S. Securities and Exchange Commission is advancing two initiatives that could carry significant weight for the crypto sector, announcing separately on Tuesday that it has finalized the agenda and participant list for its forthcoming roundtable on round-the-clock trading and has proposed a rule reshaping the definition of transfer agents to account for the growth of blockchain technology.

The Sept. 17 roundtable, to be held at the SEC’s Washington headquarters, will gather prominent securities industry participants, including those supplying the underlying financial infrastructure. The lineup features NYSE, Nasdaq, State Street, Citadel Securities, Cboe and DTCC, along with newer market entrants such as Robinhood.

While the crypto industry emerged within a technology framework that never ceases operating, round-the-clock trading would represent a transformative shift for the remainder of the markets, and crypto broker-dealers could find themselves subject to regulations stemming from this initiative. The panels will explore approaches to overnight surveillance, closing-price methodologies, and the clearing and settlement of trades, as well as the operational mechanics of such a system, including how maintenance would function in a continuous environment.

Earlier on Tuesday, the regulator also introduced a new transfer-agent rule designed to adapt that role to encompass blockchain technology and other innovations. Transfer agents are firms responsible for tracking changes in the ownership of securities — a function that has been disrupted by the emergence of onchain transactions, which occur instantly and transparently, particularly as markets increasingly adopt tokenized securities.

The proposed rule, which is subject to a 60-day public comment period, would modernize regulations that have not been updated in decades, «including the use of electronic communications and blockchain technology in connection with securities offerings and the transfer of shares,» SEC Chairman Paul Atkins said in a statement.

The rule would permit the use of blockchains as official transaction records, though it also introduces new operational controls for these firms, including in areas such as cybersecurity.

SEC Commissioner Hester Peirce, in a Tuesday statement, underscored a question central to the crypto sector’s interest in the rule: «Should transfer agents continue to be required to collect names and physical addresses of securityholders, or should the rule permit other identifiers, such as email and digital wallet addresses, to be collected instead?»

Crypto platform Bullish, the parent company of Decryptnews, recently acquired transfer agent Equiniti in a $4.2 billion deal.

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