Wall Street exchange limits tokenized stock access via DTC pilot

24X National Exchange filed SR-24X-2026-20 on June 11 to allow eligible exchange members to trade tokenized versions of certain equities on 24X during a Depository Trust Company pilot. The SEC published notices for the filing on June 16 and June 22 and placed the June 22 notice in the Federal Register.

The proposed rule changes would amend 24X provisions on eligible securities, member access, order priority and routing to accommodate tokenized forms of eligible equity securities and exchange‑traded products. Tokenized and traditional versions of the same security would appear on the same 24X order book and share execution priority only if the tokenized instrument is fungible with the traditional share and carries the same CUSIP, trading symbol and rights.

Under the filing, tokenization operates as an additional representation layer rather than a replacement of existing market plumbing. Members who want tokenized settlement would select a designated flag at order entry that may include DTC‑required details such as the blockchain and wallet address. 24X would forward that instruction to DTC, and DTC would carry out tokenized settlement only when the participant, the security, the blockchain and the wallet meet DTC’s rules, policies and the terms of the SEC staff no‑action letter that created the pilot.

The DTC pilot stems from a Dec. 11, 2025 SEC staff no‑action letter that established a limited DTCC Tokenization Services pilot. Under the pilot, a DTC participant may register approved blockchain addresses as wallets. If a participant instructs DTC to tokenize an eligible security entitlement, DTC would debit the entitlement from the participant’s account, credit it to a Digital Omnibus Account, and mint a token representing that entitlement to the participant’s registered wallet.

Cede & Co., DTC’s nominee, would remain the registered owner of the underlying securities. DTC would use an off‑chain system called LedgerScan to monitor wallet activity and maintain official books and records for tokenized entitlements. Tokens would be able to move between registered wallets tied to DTC participants while DTC retains visibility and technical controls.

The pilot includes defined limits. Eligible securities are limited to Russell 1000 stocks, U.S. Treasuries and major‑index ETFs. Tokenized entitlements would not receive collateral or settlement value under DTC’s risk controls. DTC must report quarterly to SEC staff, and the staff position is scheduled to withdraw three years after launch unless the framework changes.

24X’s filing creates an operational fallback: if a member is not eligible, a security is not eligible, a blockchain is incompatible or a wallet is not registered with DTC, orders would default to traditional settlement. The filing references a similar exchange filing that the SEC previously approved and frames the proposal as an exchange‑led approach that keeps trading, custody records and post‑trade settlement inside regulated intermediaries while adding a blockchain‑referenced representation layer.

The proposal identifies next steps required from each party: 24X must identify which securities will be eligible on the exchange, and DTC must determine which participants, blockchains and wallets it will approve under the pilot. Separate tokenization plans announced by other firms pursue different technical and settlement approaches and are not part of the DTC pilot described in the 24X filing.