Fidelity urges SEC to clarify crypto rules for broker‑dealers and ATS integration into existing market structures

Fidelity Investments has urged the U.S. Securities and Exchange Commission (SEC) to provide clearer, more comprehensive rules for how broker‑dealers and alternative trading systems (ATSs) can custody and trade crypto assets and tokenized securities within existing market structures. The firm outlined its position in a detailed written submission to the SEC’s Crypto Task Force, arguing that current guidance is fragmented and leaves significant uncertainty for regulated intermediaries. In its comments, Fidelity asked the SEC to develop a clear regulatory framework that explicitly allows broker‑dealers to offer, custody, and trade crypto asset securities and non‑securities, including on ATSs that use distributed ledger technology for trading and recordkeeping. Fidelity said staff guidance is “critical” because ATSs are operated by broker‑dealers, and those firms need confidence they can support secondary trading in tokenized securities—including those issued by third parties—without inadvertently violating rules on securities‑based swaps or unregistered securities offerings. Fidelity also called on the SEC to clarify when tokenized versions of traditional instruments (for example, a tokenized NMS security) should be treated the same as the underlying asset for regulatory purposes. Beyond technical classification issues, Fidelity urged the SEC to address how centralized and decentralized trading systems should coexist, recommending that the agency recognize the practical limits of reporting and oversight on disintermediated DeFi platforms and adjust some reporting expectations accordingly. The firm further suggested explicit permission for broker‑dealers to use distributed ledger technology in ATS operations and other back‑office functions, arguing that modernizing the rules would better integrate crypto and tokenized asset trading into the existing U.S. market structure while maintaining investor protections. "entities":["Fidelity Investments","U.S. Securities and Exchange Commission (SEC)","SEC Crypto Task Force","broker-dealers","alternative trading systems (ATSs)","tokenized securities","crypto asset securities","decentralized finance (DeFi) trading platforms","Roberto Braceras"]}`

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More coverage

• Fidelity: SEC Should Support Trading of Tokenized Securities on ATSs (marketsmedia.com)
• Fidelity urges SEC to move further on crypto activity by broker-dealers (tradingview.com)
• Guidance for Alternative Trading Systems | FINRA.org (finra.org)
• Fidelity wants clarity from SEC on rules for broker-dealers and crypto ... (investmentnews.com)
• [PDF] ctf-written-input-fidelity-investments-032026.pdf - SEC.gov (sec.gov)

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