The U.S. Securities and Exchange Commission proposed updating its rules and forms for registered transfer agents on September 1, 2026, marking the first substantive overhaul of the regulatory framework since the late 1970s and early 1980s. According to the SEC, the modernization package aims to account for widespread electronic recordkeeping, digital communications, and the use of blockchain technology in securities offerings and share transfers.
Modernizing the National Clearance and Settlement System
Registered transfer agents serve as a key component of the national clearance and settlement system, according to the SEC. These entities act as behind-the-scenes bookkeepers by maintaining official ownership records, processing ownership changes, issuing and canceling certificates, and managing dividend distributions. Because the legacy framework was built for an era of physical stock certificates and paper ledgers, it fails to address the diverse array of functions transfer agents perform today, according to the SEC.
“This proposal would streamline and modernize the Commission’s rules to reflect transfer agents’ current processes and operations, including the use of electronic communications and blockchain technology in connection with securities offerings and the transfer of shares,” said SEC Chairman Paul S. Atkins.
Jamie Selway, Director of the SEC’s Division of Trading and Markets, noted that revisiting legacy rules is necessary as the competitive marketplace evolves. According to Selway, the rule proposal represents an important step in advancing the regulatory framework for the modern era.
Engaging With Tokenized Securities and Blockchain Infrastructure
The proposal directly engages with tokenization by inviting public comment on how rules should accommodate blockchain-based recordkeeping, distributed ledger technology, and uncertificated securities. According to regulatory filings, the agency is seeking feedback on how digital wallets compare to physical addresses, what fraud risks emerge from onchain transactions, and how official ownership registers should interact with distributed ledgers.
A central element of the overhaul is Proposed Rule 17ad-31, which would establish stricter standards around restrictive legends on securities. The Securities Transfer Association has advocated for prioritizing issuer-sponsored tokenization models that integrate directly into official transfer agent registers rather than relying on third-party synthetic tokens.
Next Steps and Public Engagement
The SEC published the proposing release on SEC.gov, and the text will appear in the Federal Register. The public comment period remains open for 60 days following publication in the Federal Register. Market participants, including traditional financial institutions and crypto-native companies, are expected to use this window to address how digital assets fit into the official plumbing of U.S. capital markets.