Asset Tokenization
We advocate for legal clarity around the transformation of traditional markets through asset tokenization — the strategic process of converting ownership and economic rights in real-world assets, such as real estate, commodities, and financial instruments, into secure, programmable digital tokens on the blockchain.
Fragmented state laws governing property rights, commercial law, insolvency, and perfection of interests can create uncertainty about ownership, priority, and enforceability of tokenized assets, particularly in cross-border contexts.
Advance federal baseline standards that clarify how existing banking, payments, custody, and commercial law frameworks apply to tokenized assets.
The Policy Issues
The rules shaping digital assets, AI, and emerging technologies are being written right now. These are the issues where clear policy can unlock innovation, strengthen trust, and keep America competitive.
Legal Certainty and Commercial Law Alignment
The Asset Tokenization working group is working to establish clear, nationwide rules on ownership, transfer, custody, and insolvency treatment for tokenized assets, including alignment with federal commercial law and targeted preemption to reduce conflicting state interpretations. The efficiencies created through tokenization, from enabling near instantaneous settlement to limiting the number of intermediaries and associated costs, are set to revolutionize finance. The Asset Tokenization working group is here to ensure America remains at the forefront of this technological revolution, by ensuring there is a regulatory framework in place to protect consumers without limiting the potentials of tokenization technologies.
Banking, Payments, and Custody Integration
TDC engages federal regulators to ensure tokenization models can operate within existing banking and payments frameworks without triggering inappropriate licensing or chartering requirements.
While tokenization eliminates the need for many intermediaries, people rely on their traditional banking and financial service providers to protect and mange their assets, and this will continue in a primarily tokenized financial products world. We ensure that these traditional intermediaries have a role to play in an increasingly digital world.
AML, Sanctions, and Compliance Modernization
We advocate for risk-based, technology-neutral compliance standards so Anti-Money Laundering (AML), sanctions, and privacy obligations apply consistently across traditional and tokenized market infrastructure. While algorithms and opensource technology can take a measure of human error, fraud, greed, and bias out of the system, it also creates new risks that need to be examined and understood.
TDC aims to bring AML and sanctions compliance into the modern day, where blockchain-enabled technologies such as zero-knowledge proofs and immutable proof of humanship can address artificial intelligence driven risks.
Our Impact
We help shape the policy in which tokenized assets are understood and regulated. We do this through amicus efforts in major litigation involving asset tokenization, legislative engagement to encourage legislation that support responsible tokenization efforts, policy education, and coalition-building.
Encouraging Implementation of Tokenized Products in Traditional Finance
The Asset Tokenization working group assisted the CFTC in its recent questions regarding if and how to allow for tokenized products to serve as collateral on CFTC-regulated exchanges. Tokenized versions of existing collateral products ensure traders get the enhanced benfits of tokenized margin support including faster settlement and nearly instantaneous trade finality allowing more efficient markets to develop.
Engaging with Policymakers on RWAs
TDC assists with interagency coordination and federally supported pilot programs that allow tokenization use cases to be tested at scale while informing durable, nationwide regulatory updates.