[SEC Chairman Discusses Innovation Exemption: Regulatory Framework for Tokenized NMS Stock On-Chain Trading Released] Golden Finance reports that on September 17, SEC Chairman Paul Atkins issued a statement regarding the Commission's approval of the "Innovation Exemption." He noted that over a week ago, Congress failed to advance the CLARITY Act, prompting the SEC to take significant steps within its statutory authority today to bring the U.S. capital markets into the digital age by facilitating on-chain trading of certain tokenized stocks. The order grants two categories of temporary, conditional exemptions under Section 36(a)(1) of the Exchange Act: first, exempting "Tokenized Securities Venues" (TSVs) from the definition of "exchange" under the Exchange Act, and second, exempting certain liquidity providers ("regulated entities") from the definition of "dealer." Atkins emphasized that the anti-fraud and anti-manipulation provisions of federal securities laws fully apply to all securities activities in these markets without exception. The exemptions come with several investor protection conditions: TSVs must be U.S.-based entities and comply with OFAC sanctions; they must establish a permissioned access system, allowing only specific participants to trade; synthetic products are prohibited—tokenized NMS (National Market System) stocks must be tokenized either by the issuer of the underlying stock or its representative, or by an unrelated third party, and holders must enjoy the same rights as traditional securities (including dividends and voting rights); issuers have the right to object to and prevent their securities from being traded on TSVs. Atkins stated that the Commission is not locking in current technology as the standard for the future but is instead allowing the market to evolve, monitoring its development, and using this as a basis to establish a more flexible, forward-looking regulatory framework. The exemption is a temporary measure, and the Commission is soliciting public comments on all aspects, emphasizing that this transitional arrangement must be followed by the establishment of enduring rules to ensure that on-chain markets remain viable as capital markets evolve.