SEC Commissioner Hester Peirce: Welcome Institutional Exploration of Tokenization with Proactive Regulators

Odaily Planet Daily reports that U.S. Securities and Exchange Commission (SEC) Commissioner Hester Peirce stated that regulators are open to companies exploring asset tokenization and new structured trading products, and encourage relevant institutions to proactively communicate with the SEC.

In an interview with CNBC’s “The Exchange,” Peirce said that as the market matures, the SEC hopes that institutions developing innovative financial products—including those launching tokenized financial instruments—will engage directly with regulators. “The most important thing is ‘come talk to us about what you’re trying to do.’ We want to work with the industry and give the market a chance to test whether these new products are truly in demand.”

She pointed out that many asset management firms are currently exploring how to bundle crypto assets or blockchain securities into traditional investment vehicles, such as exchange-traded funds (ETFs).

Peirce also responded to the SEC’s recent focus on high-leverage ETFs. She emphasized that the SEC is not a “value judgment regulator” and does not decide whether a product is a good investment, but rather ensures it complies with relevant laws and fully discloses risks.

She stated that existing regulations impose certain limits on fund leverage levels, but if issuers can demonstrate that their product structure complies with securities law frameworks, alternative designs may still be considered. Currently, as some institutions attempt to launch ETFs with leverage exceeding three times, regulatory attention in this area is increasing.