Wall Street regulator allows intraday trading of tokenized WisdomTree money market fund

• The SEC exemption allows retail investors to trade the tokenized money market fund throughout the day on blockchain, rather than being restricted to end-of-day pricing required for traditional mutual funds
• WisdomTree's head of digital assets called this the first exemption of its kind for any tokenized mutual fund, signaling growing regulatory acceptance of blockchain-based securities
• The approval comes amid increasing interest in tokenized securities as crypto companies seek to benefit from Washington's increasingly favorable regulatory stance toward digital assets

Summary

The U.S. Securities and Exchange Commission (SEC) granted WisdomTree a special exemption on Monday, February 23, allowing intraday trading of its tokenized Treasury Money Market Digital Fund. This marks the first time a tokenized mutual fund has received such approval.

Key Development:

The exemption removes standard SEC regulations requiring mutual fund transactions to occur only at end-of-day pricing. WisdomTree investors can now trade the fund's tokenized shares throughout the trading day on blockchain-based distributed ledgers.

Regulatory Significance:

Brian Daly, SEC's head of Investment Management, stated the relief "preserves the protections of a regulated money market fund while permitting retail investors intra-day liquidity." Will Peck, WisdomTree's head of digital assets, described the company as "thrilled" by this first-of-its-kind approval for tokenized mutual funds.

Market Implications:

This decision represents a significant step toward broader tokenization of capital markets, allowing securities transactions on blockchain technology. The move reflects Washington's increasingly favorable regulatory stance toward digital assets, as crypto companies seek to expand tokenized securities offerings.

Context:

The approval comes amid growing attention to tokenized securities within the evolving digital asset landscape. By granting this one-off exemption, the SEC is opening new pathways for traditional financial products to operate on blockchain infrastructure while maintaining regulatory oversight and investor protections.

This development could pave the way for additional tokenized fund products and signal greater regulatory acceptance of blockchain-based trading mechanisms in traditional capital markets.