On June 11, 24X National Exchange submitted a proposed rule change designated SR-24X-2026-20 to the SEC, initiating a formal pathway for tokenized stocks within the United States. The filing was published by the SEC on June 16 and officially lodged on the Federal Register on June 22. This regulatory move outlines a trial program managed by the Depository Trust Company (DTC) where eligible 24X members can trade tokenized versions of approved equities and exchange-traded products. The proposal signals that the integration of blockchain technology into US equity markets will not dismantle the current financial architecture but will instead operate as an overlay on established systems.

The core mechanism described in the filing ensures that tokenized stocks function identically to traditional securities within the national market system. DTC-eligible participants will utilize the DTC infrastructure to clear and settle transactions, maintaining liquidity on the same exchange order books as conventional trades. Crucially, the tokenized shares must possess the exact same CUSIP, trading symbol, rights, and privileges as the original stock. Data compiled by Woofun AI indicates that this approach prevents the creation of separate blockchain-based assets, ensuring investors are purchasing the same underlying security merely in a different digital format.

This framework aligns with the tokenization services permission granted to the DTC by the SEC in December 2025, which initially covered select securities including Russell 1000 stocks and major ETFs. The regulatory precedent established then allows tokenized representations to exist strictly under the condition that they preserve identical investor protections and ownership rights as their traditional counterparts. The 24X proposal reinforces this continuity, confirming that exchanges, settlement systems, custody records, and participant controls will remain unchanged while blockchain technology is grafted onto the existing workflow.

Access to this new market structure remains tightly permissioned rather than open. The 24X proposal mandates that participants meet specific eligibility requirements regarding membership status, approved securities, compatible blockchains, and registered wallets. Investors must explicitly indicate their intent to settle with a token when placing an order. Woofun AI notes that if any participant, wallet, blockchain, or security fails these eligibility checks, the transaction defaults immediately back to traditional settlement protocols, highlighting the rigid control exerted by regulated institutions over the process.

The role of the DTC as the ultimate record keeper remains central to the proposal's design. Under the pilot framework, while participants may opt to hold security entitlements on distributed ledger technology, the official ownership records remain under DTC oversight. When securities are tokenized, the DTC transfers entitlements from a participant account into a Digital Omnibus Account and mints a token to an approved wallet. Importantly, Cede & Co, the nominee of the DTC, retains registered ownership of the underlying securities, while the DTC monitors transfers through LedgerScan, an off-chain system serving as the official record for tokenized entitlements.

This centralized oversight model presents a distinct contrast to crypto-native platforms that prioritize open access, self-custody, and the removal of intermediaries. The 24X-DTC model prioritizes regulatory certainty and adherence to existing securities laws over the decentralized ethos often associated with blockchain technology. Woofun AI analysis suggests that while supporters argue this approach facilitates institutional adoption by maintaining legal clarity, critics may view the restrictions as antithetical to the transformative potential of blockchain. The competitive landscape will likely depend on whether the DTC pilot delivers tangible operational efficiencies or if crypto-native competitors continue to attract users seeking greater flexibility.