SEC Grants WisdomTree Landmark Exemption for Intraday Tokenized Fund Trading

The U.S. Securities and Exchange Commission (SEC) has issued a landmark regulatory exemption to asset manager WisdomTree, authorizing intraday trading for its tokenized Treasury Money Market Digital Fund. This decision marks a fundamental departure from the decades-old 'Forward Pricing Rule' (Rule 22c-1 under the Investment Company Act of 1940), which typically requires mutual funds to be priced only once per day at the market close. By granting this 'one-off' relief, the SEC is effectively bridging the gap between legacy financial structures and the 24/7 liquidity expectations of the digital asset ecosystem.

The core of the development lies in the use of distributed ledger technology (DLT) to facilitate transactions. Traditionally, mutual fund investors wait until the end of the trading day to know their execution price and even longer for settlement. WisdomTree’s new model allows these tokenized shares to be traded throughout the day on a blockchain, providing retail investors with immediate liquidity and transparency. Will Peck, WisdomTree’s head of digital assets, characterized the move as a first for any tokenized mutual fund, highlighting the firm's successful navigation of complex federal securities laws to bring a blockchain-native product to a regulated environment.

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Securities and Exchange Commission (SEC) has issued a landmark regulatory exemption to asset manager WisdomTree, authorizing intraday trading for its tokenized Treasury Money Market Digital Fund.

From a RegTech perspective, this move is a significant signal that Washington’s regulatory climate is warming toward the tokenization of Real-World Assets (RWAs). For years, the SEC has been cautious about the intersection of blockchain and public funds, citing concerns over custody, valuation, and market manipulation. However, the statement from Brian Daly, the SEC’s head of Investment Management, suggests a new pragmatic approach. Daly noted that the relief preserves essential investor protections while modernizing the delivery of liquidity. This suggests that the SEC is satisfied with the auditability and security protocols WisdomTree has implemented on the blockchain to track ownership and prevent illicit activity.

The implications for the broader asset management industry are profound. This exemption sets a precedent that could allow other major players, such as BlackRock or Franklin Templeton, to seek similar relief for their own tokenized offerings. If intraday trading becomes the standard for tokenized mutual funds, the distinction between Mutual Funds and Exchange-Traded Funds (ETFs) could begin to blur, as both would offer intraday liquidity but through different technological and regulatory rails. Furthermore, the speed of settlement enabled by blockchain could significantly reduce counterparty risk and capital requirements for financial institutions.

Looking ahead, the industry should watch for whether this 'one-off' exemption evolves into a broader rule-making process. While WisdomTree has secured a first-mover advantage, the SEC’s cautious 'special request' approach indicates they are not yet ready for a blanket policy change. Legal teams and compliance officers in the RegTech space will likely view this as a green light to accelerate their own tokenization pilots, focusing on how DLT can be used to meet existing regulatory standards for transparency and investor protection while delivering the efficiency gains of digital finance.