Background and Initiative
F/m Investments, an ETF provider managing approximately $18 billion in assets, has recently filed an application with the U.S. Securities and Exchange Commission (SEC) seeking exemptions to tokenize shares of its 3-month U.S. Treasury ETF (TBIL).
The company claims this could set a precedent for the tokenization of registered investment company shares. Under the proposal, TBIL shares would be represented on a permissioned ledger with the same CUSIP identifiers, shareholder rights, fee structures, voting rights, and economic terms as the current ETF shares.
Regulation and Compliance
While tokenized securities have drawn global attention, the U.S. regulatory framework remains evolving. F/m Investments emphasized that its proposed tokenization will still operate within the regulatory structure of the Investment Company Act of 1940, ensuring board oversight, daily transparent disclosures, and third-party custody and auditing.
Industry Trends and Outlook
The tokenization of securities has attracted interest from Wall Street, regulators, and the crypto industry. Earlier this week, the New York Stock Exchange announced it is developing a platform for trading tokenized U.S. equities and ETFs with on-chain settlement, though regulatory approval is still pending.
- Tokenization can enhance trading efficiency and transparency
- On-chain securities may reshape traditional financial infrastructure
- Tokenized ETFs open new avenues for asset digitization