Fidelity Investments has officially urged the U.S. Securities and Exchange Commission to establish more detailed guidelines for digital assets and blockchain-based securities. The asset management company delivered its 14-page correspondence to the SEC’s Crypto Task Force, seeking to bridge regulatory gaps and address persistent industry uncertainties.
Focused Push for Alternative Trading Rules
Fidelity delivered its recommendations in response to SEC Commissioner Hester Peirce’s December call for industry perspectives, specifically related to frameworks for national securities exchanges and alternative trading platforms handling cryptocurrencies. As one of the world’s leading investment firms, Fidelity manages several trillion dollars in assets and has actively expanded its digital asset services in recent years.
The correspondence outlined four priority areas. At the forefront, Fidelity underscored the need for evolving broker-dealer standards. The firm cited recent SEC guidance that confirmed broker-dealers can custody both crypto securities and non-security digital assets. While this clarification was welcomed, questions remain around how trading operations, custodial procedures, and related oversight should function under current regulations.
Fidelity also noted that broker-dealers stepping into the crypto arena must do so without excessive legal risk. The firm advocated for regulatory clarity that would allow these institutions to securely offer custody and facilitate trades in compliance with federal standards, thereby reducing operational ambiguities.
Tokenized Securities and Regulatory Alignment
A significant portion of Fidelity’s submission dealt with tokenized securities—classic financial products like stocks, bonds, real estate, and credit arrangements issued or tracked using blockchain technology. The firm called for the SEC to establish concrete rules for alternative trading systems (ATS), granting these platforms authority to process transactions involving tokenized versions of familiar financial instruments.
Fidelity pressed for confirmation that such digital representations should enjoy regulatory treatment consistent with their underlying assets. Clear asset classification could, the firm suggested, reduce market inconsistencies and legal uncertainty that may hinder institutional participation in blockchain-based systems.
Roberto Braceras, general counsel at Fidelity, emphasized the need for a modular approach that accommodates both centralized and decentralized trading architecture. He urged the SEC to build flexibility into its frameworks so that both traditional and blockchain-native platforms can operate under rules proportionate to their structures.
The correspondence argued that decentralized finance platforms are ill-suited for existing reporting requirements imposed on centralized venues, warning that disproportionate compliance burdens could slow or even block further adoption of innovative models.
Banking Regulators Weigh In on Blockchain Settlement
Fidelity’s letter further asked the SEC to confirm that broker-dealers can leverage blockchain infrastructure for regulatory recordkeeping and on-chain settlements, without triggering additional regulatory classifications as clearing agencies. The company also referenced a coordinated statement from federal banking overseers, issued in March by the Federal Reserve Board, Federal Deposit Insurance Corporation, and Office of the Comptroller of the Currency.
According to this policy bulletin, tokenized securities are subject to capital requirements that match their conventional counterparts, regardless of whether the underlying technology changes. The agencies stressed that blockchain infrastructure does not alter the classification or risk weighting of traditional financial assets once tokenized.
Commissioner Peirce has continued to encourage financial institutions to maintain open channels with regulators, in contrast with earlier enforcement-led approaches that were viewed as more restrictive by much of the digital asset industry.
