Blockchain Association Backs SEC Push to Retire Outdated NMS Rules
The industry group argues that 2005-era regulations have failed their original objectives and may hinder modern market structures like tokenized assets.
Industry Group Endorses Regulatory Overhaul
The Blockchain Association has thrown its support behind an effort by the Securities and Exchange Commission to eliminate National Market System rules that have remained in place for nearly two decades. The organization contends that these 2005-era regulations no longer serve the functions they were designed to accomplish and have become misaligned with contemporary market developments.
Rules Miss Their Mark
According to the Blockchain Association, the existing NMS framework has demonstrably failed to meet the objectives established when the rules were originally adopted in 2005. The group’s backing of the SEC’s proposal to scrap these provisions reflects growing consensus within the digital asset industry that outdated equity-market regulations pose obstacles to innovation, particularly as financial infrastructure evolves toward tokenization and blockchain-based settlement.
Opening Doors for Tokenization
The push to retire these rules could clear regulatory pathways for tokenized assets and modern market structures that existing frameworks were not designed to accommodate. As markets increasingly explore distributed ledger technology for trading and settlement, regulations written in the pre-crypto era may actively constrain beneficial innovation rather than protect market participants. The Blockchain Association’s support signals that industry stakeholders see alignment between regulatory modernization and the broader digital asset ecosystem’s infrastructure needs.
The SEC’s willingness to reconsider rules that have remained substantially unchanged for two decades suggests recognition within the agency that financial markets have undergone significant structural changes. Whether through retail participation, algorithmic trading, or emerging asset classes, today’s markets look vastly different from those of 2005. Regulations that fail to adapt risk becoming counterproductive—creating compliance costs without delivering the protective benefits they were originally intended to provide.
This development reflects a broader conversation between regulators and the crypto industry about which legacy frameworks remain necessary and which may be hindering the market structures of tomorrow. Rather than wholesale deregulation, the Blockchain Association’s position represents a targeted effort to remove specific provisions judged ineffective by their own standard.
Source: Blockchain Association, via the source. Not financial advice.
Why it matters: Clearing regulatory obstacles to tokenization directly benefits infrastructure modernization that projects like Ripple and the broader XRP ecosystem depend on for institutional adoption.