Canton Coin Gets SEC Nod as Wall Street Tokenization Heats Up

In brief

• The SEC’s Division of Corporation Finance said it views Canton Coin as a “digital commodity” and won’t recommend enforcement over its programmatic minting.
• Staff cited Canton’s representations that the token derives value from network operation and that the network has no central party.
• The relief follows DTCC’s launch of a tokenization service on Canton, which Morgan Stanley says it’s among the first banks to use.

The blockchain behind Wall Street’s newest tokenization service just got a regulatory nod for its native token.

The SEC’s Division of Corporation Finance said in a letter dated Tuesday that it views Canton Coin, the native token of the Canton Network, as a “digital commodity” under the agency’s March interpretation of how securities laws apply to crypto.

Agency staff also said they won’t recommend enforcement action if Canton’s validators and application providers mint the token programmatically without registering it.

The relief comes a week after the Depository Trust & Clearing Corp. launched a tokenization service that runs on Canton and DTCC’s own private network, letting firms convert DTC-held stocks and Treasuries into tokens. Morgan Stanley said Tuesday that it was among the first banks to use the service.