SEC adopts Ethereum token standard for compliant securities in 3 key regulatory shifts

The U.S. Securities and Exchange Commission (SEC) held a landmark meeting with blockchain organizations last week to discuss the potential of an Ethereum token standard for compliant securities, showing a possible thaw in the regulator’s historically cautious stance.

The SEC’s Crypto Task Force met with representatives from the ERC-3643 Association, Chainlink Labs, and other Ethereum-aligned groups to explore how open standards could align blockchain innovation with securities laws—a move experts call a “major step” toward U.S. leadership in tokenized finance.

Why the SEC is rethinking blockchain compliance

For years, the SEC has taken a hardline approach to crypto regulation, but last Thursday’s meeting revealed a newfound willingness to collaborate. Central to discussions was ERC-3643, an Ethereum token standard for compliant securities designed to enforce identity verification, asset control, and regulatory adherence onchain.

Dennis O’Connell, president of the ERC-3643 Association, told journalists:

“The task force was very welcoming, engaged, and motivated to bring the U.S. into leadership. We laid out why standards like ERC-3643 are fundamental to growing crypto in the U.S.”

The dialogue marks a stark contrast to past SEC skepticism. O’Connell noted the agency had not previously considered how open standards could address concerns about investor protection and market integrity—key hurdles for Ethereum token standards for compliant securities to gain traction.

How ERC-3643 and Chainlink aim to bridge the gap

The meeting highlighted two pivotal technologies:

1. ERC-3643: A tokenization framework backed by major firms like Chainlink, enabling programmable compliance for securities on Ethereum.

2. Chainlink’s Automated Compliance Engine (ACE): A smart-contract system that verifies regulatory requirements in real-time.

Industry presenters argued these tools could automate traditionally manual processes, such as KYC checks and trading restrictions. O’Connell emphasized:

“Tokenized securities aren’t about bypassing rules—it’s about embedding them into the tech.”

The SEC reportedly did not endorse any specific solution but expressed openness to understanding how an Ethereum token standard for compliant securities could meet its mandate.

Ethereum token standard for compliant securities: SEC chair signals broader tokenization push

The meeting’s momentum carried into public remarks by SEC leadership. Chair Paul Atkins told Bloomberg the agency is exploring an “innovation exemption” to accelerate tokenized asset development, stating:

“If it can be tokenized, it will be tokenized. We’re evaluating how to support this shift responsibly.”

Atkins’ comments align with global trends. The EU’s MiCA framework and Singapore’s Project Guardian have already embraced blockchain for capital markets, leaving the U.S. racing to catch up.

What’s next for Ethereum and regulated finance?

The ERC-3643 Association plans ongoing engagement with the SEC, aiming to formalize the Ethereum token standard for compliant securities as a benchmark. Key unresolved questions include:

• How the SEC will classify tokens under existing securities laws.

• Whether decentralized systems can satisfy custody and reporting rules.

Despite uncertainties, the meeting has injected optimism. As O’Connell noted:

“This wasn’t just talk—it was the start of a process to modernize finance.”

Key Takeaways

• The SEC is actively exploring an Ethereum token standard for compliant securities, per last week’s meeting with industry groups.

• ERC-3643 and Chainlink ACE emerged as leading solutions to automate compliance.

• SEC Chair Atkins hinted at regulatory flexibility to foster tokenization.