Press Releases

Today, the House Committee on Financial Services, led by Chairman French Hill (AR-02), held a hearing examining the role tokenization can play in modernizing our capital markets and if regulatory updates could benefit U.S. competitiveness. Members explored how traditional securities can be brought onto blockchain networks, what that could mean for investors, and how to ensure investor protections and market integrity still remain strong as the technology evolves.

On the Impact of Tokenization:

Chairman Hill said, “By leveraging distributed ledger technology to represent financial instruments and their ownership, tokenization has the potential to streamline processes and introduce entirely new ones, promising greater efficiency, transparency, and accessibility. However, as tokenization becomes more prevalent in our capital markets, it raises important legal and regulatory questions.”

Small Business Committee Chairman Roger Williams (TX-25) said, “We've heard today how tokenization can modernize our capital markets, including faster settlements, reduced counterparty risk, more efficient movement of capital. Shortening the settlement cycle can free up liquidity, reduce costs tied to delays, and allow capital to be put to work more freely. For a small business owner operating on tight margins like myself –  I'm a small business owner in Texas – tokenization can translate into better financing, more predictable cash flow, and lower costs.”

Rep. Tim Moore (NC-14) said, “Tokenization has the potential to fundamentally modernize how our operates work. It enables these traditional financial assets to be represented on blockchain based systems. It means faster settlement, lower cost, greater transparency and expanded access for investors. But today's markets still rely on layers of intermediaries that process, which can delay settlement and increase operational risk. Tokenization, however, introduces the possibility that transactions can be completed in real time.”

On the Need for Regulatory Modernization:

Subcommittee on Capital Markets Chairman Ann Wagner (MO-02) said, “The United States has the deepest and most liquid capital markets in the world. As one of our economy's greatest strengths, they have helped make America the premier destination to start and grow a business. However, global competition is intensifying and other jurisdictions are actively modernizing their financial systems to attract investment.”

Subcommittee on Financial Institutions Chairman Andy Barr (KY-06) said, “No doubt tokenization of securities is coming. It's here. And our modernization of our securities regulation is required, both in terms of preserving that gold standard of investor protection, but also making sure that the United States is leading the way.”

Task Force on Monetary Policy, Treasury Market Resilience, and Economic Prosperity Chairman Frank Lucas (OK-03) said, “This topic also raises important questions about how to integrate new technology into existing market regulations. Our capital markets, I think we would all agree, are the envy of the world and certainly we must safeguard that status.”

Subcommittee on Digital Assets, Financial Technology, and Artificial Intelligence Chairman Bryan Steil (WI-01) said, “Our capital markets have long been the envy of the world and led because we've consistently upgraded both our market infrastructure, but also importantly, upgraded our rule books. And that means providing clear rules of the road for innovators developing new base layer technologies and applications, as well as some integrators combining those tools with, in some cases, centuries of market expertise. If we get this right, I think we can uphold the core principles of capital formation, liquidity, and investor protection while making the regulatory upgrades needed to sustain them in a rapidly evolving financial system.”

Rep. Young Kim (CA-40) said, “When we discuss the term “brain drain,” it's often used in the context of foreign content, the talents leaving their home countries to come to America because of the opportunities that we provide. However, in the digital asset industry, this strain reflects a 2% year over year decline in the U.S. share of blockchain developers over the last five years. In 2018, the U.S. share of global blockchain developers was 40%, and today it is down to 20%. While the rogue regulation of former SEC Chair Gary Gensler did America no favors in fostering crypto innovation in America, that does not mean it is too late to reverse his policies and establish America as the Crypto Capital of the World by doing something that we already did, passing the CLARITY Act.”

Witnesses Echoed the Work of the Committee:

The Honorable Kenneth Bentsen, Jr., President and Chief Executive Officer, SIFMA said, “The United States leads the world with the deepest, most liquid capital markets built on a foundation of robust investor protection and market transparency and integrity. The undergirding of that foundation is the most technologically sophisticated market infrastructure that ensures robust operational resiliency proven to deliver maximum execution quality and efficiency including during periods of extreme stress. Our markets’ quality and growth, including operational efficiency, are the result of constant investment in new technology and processes to better serve clients. As such, SIFMA and its members strongly support innovation in the securities markets and believe new technologies such as distributed ledger technology (“DLT”) and tokenization offer many potential benefits for the U.S."

The Honorable Summer Mersinger, Chief Executive Officer, Blockchain Association said, “Tokenization can make it easier to access and manage investments in familiar financial products—such as holding tokenized securities in retirement or brokerage accounts, receiving income from tokenized funds or bonds, and transferring assets more quickly and efficiently. For long-term savers, this could mean more flexible access to income-generating investments, simpler portfolio management, and the ability to transact outside of limited market hours. For businesses, tokenization can lower the cost of raising capital and broaden the pool of potential investors. These practical use cases illustrate how tokenization can support a wide range of Americans, from individual savers to institutional market participants. The benefits of tokenization reflect broader changes in how capital markets operate. By modernizing how assets are recorded, transferred, and settled, tokenization can improve efficiency, reduce risk, and expand access to financial markets.”

Mr. Christian Sabella, Managing Director and Deputy General Counsel, DTCC said, “At DTCC, we believe tokenization offers an exciting potential to carry that effort further by pushing financial markets toward a more streamlined and resilient ecosystem where DLT networks and traditional industry rails seamlessly integrate. That said, any new tokenized service of the financial future needs to ensure that it can protect and promote the same goals our traditional markets deliver today: choice, competition, interoperability, and the most liquid and dynamic financial markets in the world.”

Mr. John Zecca, Executive Vice President and Global Chief Legal, Risk and Regulatory Officer, Nasdaq said,“Tokenization should be viewed as part of a broader modernization of capital markets—toward a more continuous, more automated, and more interconnected financial system. History shows that when companies are able to access deep, competitive public markets, they invest more, expand faster, and create more jobs—underscoring why market structure decisions have real consequences for economic growth. Nasdaq’s leadership has described 23/5 trading as an initial step toward an always‑on market infrastructure for the future, and tokenization as a complementary capability that can modernize how securities move through the lifecycle—from trading and settlement workflows to issuer‑investor engagement.”

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