Morning Minute: SEC Reverses Course on Tokenized Stocks, HYPE Soars

TL;DR

The SEC has reversed its stance, allowing third-party platforms to tokenize stocks, leading to a 5% surge in HYPE. Bitcoin remains steady at $76.8k amidst various market developments.

Key points

SEC allows tokenization of stocks by third-party platforms
HYPE token rises by 5%
Bitcoin priced at $76.8k
Citi warns of quantum risk for Bitcoin
Echo Protocol exploited but regained control

Mentioned in this story

SECCiti

Echo ProtocolHYPE

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Today’s top news:

Crypto majors are flat, led by HYPE; BTC at $76.8k
HYPE +5% as the SEC will allow 3rd party platforms to tokenize stocks
Strategy announces $2B buy from last week; STRC falls under $99
Citi warns that Bitcoin faces bigger quantum risk than ETH
Echo Protocol exploited on Monad, regained control over keys overnight

🔄 The SEC Just Reversed Course on Tokenized Stocks

The SEC is leaning toward allowing third-party platforms to tokenize stocks without requiring issuer consent, Bloomberg Law reported Monday.

This is a significant reversal from the agency’s January 28 guidance, which drew a sharp line between issuer-approved tokenization and third-party products, warning that the latter typically provided only synthetic exposure rather than true equity ownership.

If formalized, the shift would greenlight an entirely different model for tokenized equities. Under the January framework, only companies that formally integrated blockchain into their official shareholder records, like DTCC’s planned July launch, could offer legitimate tokenized stock exposure. Third-party platforms like Kraken’s xStocks, Robinhood’s Arbitrum-based tokenized equities, and OKX’s private company perps were operating in a legal gray zone. The new posture, per Bloomberg Law, would allow those platforms to proceed without waiting for issuer participation.

That’s a massive unlock, and the stakes here are enormous. The tokenized securities market has grown 200% year-over-year to $30 billion, with DTCC, BlackRock, JPMorgan, and Franklin Templeton all filing or launching tokenized products in the past month alone.

Hyperliquid arguably stands to benefit the most, at least in the near term, and the market responded by sending it to $48 and a new local high.

📉 Strategy Buys $2 Billion in Bitcoin, Bitcoin Goes Lower

Strategy purchased 24,869 BTC between May 11 and May 17 for approximately $2.01 billion at an average price of $80,985 per coin, funded almost entirely by $1.949 billion in STRC preferred stock issuances plus $83.7 million in MSTR common shares.